30173 - CORPORATE BANKING
Course taught in English
Go to class group/s: 31
Lezioni della classe erogate in presenza
Students are expected to have knowledge of basic topics covered in Accounting courses.
The crisis of 2007-2008 shed light on the diminished importance of deposit taking institutions’ and capital markets’ role in funding. The operations of other players, that structure an alternative credit system – usually called “shadow banking” - allowed to provide funding more cost-efficiently to those in need. On the other hand, the lack of adequate regulation on the participating institutions fostered the crisis itself. While the crisis put its importance into question, shadow banking has since returned to its pre-crisis peak. At the heart of it are investment banks (IBs). IBs provide sponsorship, services and funding to the complex legal entities that structure shadow banking. On top of that, they are key participants to the financial markets' workings as they supply liquidity through trading and asset management and support firms that intend to employ it to obtain funding. Hedge funds and private equity funds are also important players in both arenas. Due to their role in today's financial landscape, the mission of the course is to understand the above financial intermediaries' production process and organizational structure, also framing their historical evolution over time.
Starting from the analysis of the financial needs of the firms, the course describes the ways in which intermediaries create value through their advisory and capital deployment activities.
- The first (and main) section is specifically devoted to investment banks, depicting their organizational structure and the services they offer in the security issuance, M&A, sales and trading, research and wealth management businesses.
- The second part deals with hedge funds, private equity funds and focuses on LBO deals valuation.
- Cases discussion is part of the coursework.
- Describe investment banks', hedge funds' and private equity funds' operations.
- Identify the above intermediaries' regulatory constraints and their business implications.
- Illustrate the above intermediaries organizational structure.
- Explain the way the above intermediaries apply specific tools and techniques in order to perform their operations.
- Understand his/her position, his/her relationship with colleagues and possible carreer alternatives within an Investment bank (IB)/Hedge fund (HF)/Private equity fund (PE) in order to effectively manage links and connections.
- Understand the requirements of different carreers within an IB/HF/PE. That should help in matching the student's abilities (and in developing the needed ones) with the intended professional future.
- Frame the application of tools and techniques to specific tasks.
- Acquire the financial vocabulary needed to understand colleagues and clients.
- Face-to-face lectures
- Case studies /Incidents (traditional, online)
- Individual assignments
Cases are included in the course materials. In order to foster class participation in cases discussion I ask the students to read the case in advance. Before each case discussion lecture, I provide them with questions to answer so that they focus their reading towards the main points and do not waste time on details. In order to understand if the main concepts of each case have been delivered, if the students want to obtain extra points (up to 0,5 for each case) I ask them to fill a form that I provide after each discussion.
For all students (both attending and non-attending):
- 1 hour closed book final exam consisting of multiple choice and open-ended questions. The maximum grade at the exam is 30.
- To obtain extra points, completion of up to six individual assignments is required. Each assignment is linked to a case discussion and award a grade up to 0.5. I ask the students to fill a form that I provide after each discussion. The extra points do not give any rounding benefit (meaning that if the student wants a higher grade, he/she should at least obtain 1 full point).
- Slides and additional materials are available through the students' agenda.
- Even though buying a book is not strictly required, I think that the one below can be useful: D.P. STOWELL, Investment Banking, Hedge Funds and Private Equity, Academic Press, Elsevier Inc., 2017, 3rs edition (the second edition of the same book is also fine).