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Entrance Exam
 
 
  M.A. Programme |  Doctoral Programme
   
  Syllabus M.A. Credit Course Electives
 

Banking: Theory and Policy

  1. Semester: III/IV.
  2. Number of credits: 4

Preamble
The objective of the course is to introduce students to the different aspects of commercial banking theory and policy over 48 lectures. The course would discuss the evolution of different kinds of financial systems, the importance of financial intermediaries and the bank as an important financial intermediary. The course would also deal with issues regarding competition in banking, the need for prudential regulation and would discuss the structure of banking in India along with a focus on the role of banks in aiding financial inclusion and as a support for the microfinance institutions.

Module 1: (14 lectures)
Introduction: Evolution of financial systems (bank oriented and market oriented systems) –Sources and Uses of Funds – need for financial intermediaries – banking in general equilibrium theory (14 Lectures)

Module 2 (10 lectures)
Competition in Banking: Competition and Networks (unitary and branch banking) – Effect on reputation and risk taking – Competition and Financial Stability (10 Lectures)

Module 3 (12 lectures)
Banking Regulation: Banking Crises/Bank Panics - Need and Scope for prudential regulation – Micro and Macro prudential indicators – Risk-based regulatory capital – Deposit Insurance – Universal Banking (12 Lectures)

Module 4 (12 lectures)
Indian Banking: Structure of the banking system – Changes in priority sector lending – Performance of public sector banks in the post reform period – recent developments in banking: electronic banking, relationship banking: collateral lending, SARFESI – Financial Inclusion – Microfinance institutions (12 Lectures)

References
1.
Allen, F. and D. Gale (2001): Comparing Financial Systems, The MIT Press, Cambridge, Massachusetts
2.
Freixas, X. and J. Rochet (1999): Microeconomics of Banking, The MIT Press, Cambridge, Massachusetts.
3.

Berger, A., P. Molyneux and J. Wilson (2010): The Oxford Handbook of Banking, Oxford University Press, New York.

4.
Ramakrishna, G. and K.Rao (2008): Performance of Public Sector Banks After Reforms, Serials Publications, New Delhi.
5.
Ghate, Prabhu (2007): Indian Microfinance: The Challenges of Rapid Growth, Sage, New Delhi.
 

Additional Readings

1.
Hardy D.C. and Pazarbasioglu, C. (1998): Leading Indicators of Banking Crises: Was Asia Different? International Monetary Fund Working Paper
2.
Polizatto, V.P. (1990): Prudential Regulation and Banking Supervision: Building an Institutional Framework for Banks, World Banking Working Paper WPS 340.
3.
Berger A.N. and G.F. Udell (1995): Relationship Lending and Lines of Credit in Small Firm Finance, Journal of Business, vol.68, no.3, pp.351-81.
4.
Reserve Bank of India Bulletins (various issues).
 
  Core Courses  |  Electives
 
 
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