ICM128-Risk Management in Financial Services

Module Provider: ICMA Centre
Number of credits: 10 [5 ECTS credits]
Level:7
Terms in which taught: Autumn term module
Pre-requisites:
Non-modular pre-requisites:
Co-requisites:
Modules excluded:
Current from: 2019/0

Email: d.govindarajan@icmacentre.ac.uk

Type of module:

Summary module description:

This module allows students to develop a meaningful understanding of financial intermediation, the consequent risks posed to, and by, financial intermediaries, and how these should be addressed.  

Aims:

The module aims to help students develop a meaningful understanding of

• 
  

  financial intermediation,

  
  


• 
  

  the consequent risks posed to, and by, financial intermediaries, and

  
  


• 
  

  how these should be addressed.  

  
  

Assessable learning outcomes:

Students should be able to:

• 
  

  Reflect a good and general understanding of the financial services landscape and real economic needs 

  
  


• 
  

  Evaluate the role of, and critically examine the purpose of, different financial intermediaries in the context of real economic needs and the nature and needs of different stakeholders 

  
  


• 
  

  Recognise risk – both financial and conduct – in a financial services context, to a range of stakeholders 

  
  


• 
  

  Compare and contrast the nature, impact and significance, assessment and mitigants for different types of risk – both financial and conduct-related 

  
  


• 
  

  Recognise and explain real world examples of the crystallisation of different risks meaningfully 

  
  


• 
  

  Be able to discriminate between those aspects of financial intermediation that deliver value to societal stakeholders and those that don’t, and critically reflect upon the extent to which such value is worth the risks taken in different contexts 

  
  


• 
  

  Be able to communicate those value judgements, fluently, precisely and effectively to expert and non-expert audiences 

  
  

Additional outcomes:

Recognise civic responsibilities associated with engaging in financial services activities and the key ethical dilemmas therein 

Outline content:

We will begin by understanding the key risks posed by, and to, financial firms, markets and intermediaries. This includes a discussion of aspects of financial intermediation, financial firms’ strategies, risk appetite, risk lifecycle, business model risks, credit risk, market risk, operational risks, interest rate risks, regulatory risk, reputational risks, pension obligation risks, model risks, liquidity risks, securitisation risks and so on. 

 We will also understand the challenges that different stakeholders confront when interacting with financial firms. We will examine how to address such risks and ensure stakeholder interests are given due protection. Prudential controls (such as capital and liquidity), conduct of business controls and macro-prudential mechanisms will be discussed. We will study the role and responsibilities of the risk management function and the Chief Risk Officer within financial firms and develop key skills for creating practical risk management frameworks. The interaction between risk, management, compliance, internal audit and the business will be examined through practical classroom exercises and dialogue with senior practitioners and regulators. 

Case studies, current legal positions and interactive student discussions or presentations are used in most lectures. In addition legal, academic, practitioner and regulatory input is gained through specialist guest lectures. 

Global context (where appropriate):

This is the first (and compulsory module) for the the MSc CMRC programme. It is also open to students from the School of Law. The programme aims to: 

• 
  

  provide students with a sound, practical and theoretical basis for successful careers in risk management, compliance, regulation and allied work streams within the financial industry 

  
  


• 
  

  challenge current and past thinking on the role of financial firms and risk management, governance and compliance. 

  
  


• 
  

  encourage students to examine regulatory structures and concepts especially in the context of the recent financial crisis, which provides us with a rich source of information on the pros and cons of various options. 

  
  


• 
  

  provide students with the skills and knowledge needed to gain an understanding of the reform processes and their consequences for markets around the world. 

  
  

 Skills are developed through creating a broader understanding of financial firm risk-taking, accountability, governance and the challenges regarding transparency and self-correction in cases where governance has failed. The emphasis is on a deeper analysis of mainstream and critical authorship. 

Global context:

This 10-credit module is the first part of a three-part programme, preparing students for careers in risk management, internal audit, compliance and regulation, in addition to more senior roles within the business.

Brief description of teaching and learning methods:

Summative assessment- Examinations:

N/A

Summative assessment- Coursework and in-class tests:

Formative assessment methods:

Seminar presentations and groupwork

Preparation of early draft annotated biblography

Penalties for late submission:

Penalties for late submission on this module are in accordance with the University policy. Please refer to page 5 of the Postgraduate Guide to Assessment for further information: http://www.reading.ac.uk/internal/exams/student/exa-guidePG.aspx

Assessment requirements for a pass:

50% weighted average mark

Reassessment arrangements:

Resubmission of essay, as part of the overall examination arrangements for the MSc programme.

Additional Costs (specified where applicable):

1) Required text books: £50 2) Specialist equipment or materials: 3) Specialist clothing, footwear or headgear: 4) Printing and binding: £5 5) Computers and devices with a particular specification: 6) Travel, accommodation and subsistence:

Last updated: 8 April 2019