ESF:MKF_RDFT Bank Regulation & Supervision - Course Information

MKF_RDFT Regulation and Supervision FIMA

Extent and Intensity

26/0/0. 4 credit(s). Type of Completion: zk (examination).

Teacher(s)

Mgr. Zuzana Gric, Ph.D. (lecturer)
Mgr. Ing. Filip Hampl, Ph.D., LL.M. (lecturer)

Guaranteed by

Mgr. Zuzana Gric, Ph.D.
Department of Finance – Faculty of Economics and Administration
Contact Person: Iva Havlíčková
Supplier department: Department of Finance – Faculty of Economics and Administration

Timetable

Sat 5. 3. 12:00–15:50 VT105, Sat 19. 3. 12:00–15:50 VT105, Sat 2. 4. 12:00–15:50 VT105

Prerequisites

The course assumes basic knowledge and skills in the areas of:
- central and commercial banking,
- financial markets and the activities of financial institutions,
- theory of law (systematics of law, the distinction between private and public law) and legal regulation of direct protection of persons in a weaker position on financial markets in the scope of the course Law and Finance,
- work with legal information.

Course Enrolment Limitations

The course is also offered to the students of the fields other than those the course is directly associated with.

fields of study / plans the course is directly associated with

• Finance (programme ESF, N-FIN)
• Finance (programme ESF, N-FU)

Course objectives

The aim of the course is to acquaint students with the reasons (the „why“), bodies (the „who“), and tools (the „how“) of financial markets supervision and aspects of their legal regulation. The course serves as a comprehensive excursion into the issues of financial regulation, not only in the Czech Republic, the European Union but also in the international context. The course uses historical events in financial markets as a starting point to explore the challenges of regulating financial markets, emphasizing risks to financial systems. It focuses on regulatory tools from two perspectives: (i) public law aspects of financial market supervision as a whole, including current topics such as high-frequency trading, derivatives transactions, virtual assets, or FinTech; and (ii) financial stability and the role of macroprudential policy. The course also pays attention to the institutional and functional aspects of the supervisory and regulatory bodies.

Learning outcomes

After completing the course, students will be able:
- To formulate reasons, goals, and methods of supervision and regulation of financial markets.
- To understand the legal aspects of supervision and regulation of financial markets and to formulate their quantitative impacts on financial institutions as well as on financial systems.
- To apply the knowledge gained in the field of macroprudential policy in assessing the stability of individual financial systems.
- To orientate in the system of supervisory and regulatory bodies in the Czech Republic, but also in the European Union and internationally.
- To formulate the impact of new trends on the area of regulation and supervision of the financial markets.

Syllabus

• 1. Lecture:
• - Historical events in the financial markets, their effects on financial stability, risks for the financial system as the material reasons for regulation and supervision of the financial market. The meaning of the term financial stability. (the „why").
• - Fundamentals of financial markets. Discussion on the reasons for regulation and supervision of the financial market, the quantitative aspects of risks for financial systems. Brush up on Bloomberg Terminal.
• - Macroprudential and microprudential policy – its concept, systematics, and focus. Legal grounding of the regulation and supervision of financial markets, the system, and overview of the legislation. The importance of the European Union's law for the implementation of national supervision.
• - Functional and institutional concept of supervision in the Czech Republic and the European Union. European System of Financial Supervision (ESFS) - ESRB (macroprudential supervision) and EBA, ESMA, EIOPA (microprudential supervision). International bodies for the financial market supervision. Possible models and the institutional approaches to supervision. (the "who")
• 2. Lecture:
• - Macroprudential supervision - care for financial stability. Capital adequacy requirements (especially Basel III). (the „how“ I)
• - Risks to financial markets addressed by macroprudential and microprudential policy. Mandates of supervisory authorities. Macroprudential supervision I: solving the case studies focused on capital adequacy.
• - Macroprudential supervision II: solving the case studies focused on capital adequacy and mortgage loans.
• 3. Lecture:
• - Microprudential supervision - obligations imposed on financial institutions, in particular by MiFID II, AMLD V and MIFIR, MAR, EMIR. (the „how“ II)
• - Microprudential supervision: solving the case studies focused on the indirect investor protection within the framework of MiFID II, MiFIR, MAR, EMIR, and AMLD V.
• - Specific areas and challenges of financial market regulation and supervision: shadow banking, virtual currencies, FinTech and P2P lending. (the „how“ III)
• - Discussion on the specific areas and new challenges to the financial market regulation and supervision – eg. banking union, virtual assets, FinTech, P2P lending.
• Students of the course Regulation and Supervision of the Financial Markets shall use the web portal pravoesf.econ.muni.cz. They should also pay attention to the study texts in the course Law and Finance, which lists the basic legal institutes, the knowledge of which is assumed to be understood by the participants of the course Regulation and Supervision of the Financial Markets. The course employes the legal information systems ASPI and Bloomberg Terminal. Students can access the ASPI in all computer classrooms in the ESF building and also via a remote desktop within the Orion terminal server (connection instructions are available on the econ.muni.cz website). Access to the Bloomberg Terminal is possible in the ESF building upon prior reservation.

Literature

required literature
• ARMOUR, John, et al. Principles of financial regulation. Oxford University Press, 2016. Available from: https://dx.doi.org/10.1093/acprof:oso/9780198786474.001.0001. URL info
• ALEXANDER, Kern. Principles of banking regulation. First edition. Cambridge: Cambridge University Press, 2019, xxii, 473. ISBN 9781108427265. info

recommended literature
• KABELÍK, Karel. Banking regulation : trends & impacts. First edition. Prague: Czech Banking Association, 2014, 219 stran. ISBN 9788026073345. info
• ZRŮST, Lukáš. Selhání subjektů finančního trhu. Vydání první. Praha: Wolters Kluwer, 2019, xiv, 228. ISBN 9788075985118. info
• BLAHOVÁ, Naďa. Rizika bank a jejich regulace. 1. vydání. Jesenice: Ekopress, 2018, 283 stran. ISBN 9788087865477. info

Teaching methods

Consultations, lectures, case studies, self-study of assigned literature.

Assessment methods

The course is completed by a written exam. To successfully pass the written exam, it is necessary to obtain at least 60% of the points. Students can obtain bonus points for active participation in lectures during the semester. The number of bonus points available for the students will be determined at the beginning of the semester. The bonus points will be added to the overall evaluation of the course if the written exam would be successfully passed (i.e if students obtained at least 60% of points).

The following classification scales apply to student evaluation: A: 93 - 100%, B: 92 - 85%, C: 84 - 77%, D: 76 - 69%, E: 68 - 61%, F: less than 61%.

Note: “Any copying, recording or leaking tests, use of unauthorized tools, aids and communication devices, or other disruptions of objectivity of exams (credit tests) will be considered non-compliance with the conditions for course completion as well as a severe violation of the study rules. Consequently, the teacher will finish the exam (credit test) by awarding grade "F" in the Information System, and the Dean will initiate disciplinary proceedings that may result in study termination."

Language of instruction

Czech

Further comments (probably available only in Czech)

Study Materials
The course is taught annually.
Information on the extent and intensity of the course: tutorial 12 hodin.

Teacher's information

Other resources:

- Information sources of the Czech National Bank (https://www.cnb.cz/cs/)

- Information sources of the European Central Bank (https://www.ecb.europa.eu/)

- Information sources of the European financial supervisory authorities: European Securities and Markets Authority (ESMA, https://www.esma.europa.eu/), European Banking Authority (EBA, https: //www.eba. europa.eu/), the European Insurance and Occupational Pensions Authority (EIOPA, https://www.eiopa.europa.eu/), and the European Systemic Risk Board (ESRB, https: //www.esrb.europa. eu /).

• Enrolment Statistics (Spring 2022, recent)
  
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