| Semester 2, 2023 Online | |
| Units : | 1 |
| School or Department : | School of Business |
| Grading basis : | Graded |
| Course fee schedule : | /current-students/administration/fees/fee-schedules |
Staffing
Course Coordinator:
Requisites
Pre-requisite: FIN1101
Overview
Lending constitutes one of the most important functions of any financial institution. In a typical bank, around 70% of funds are invested in loans and advances. As we have seen with the global financial crisis, if the lending function is not managed properly, it can lead to serious credit quality issues that can have a destabilising effect on individual lenders and ultimately on the financial system. To manage the lending function properly, and to mitigate credit quality problems, adequately trained staff are required. The goal of this course is to equip students with requisite skills toward this end.
Business firms extend credit, banks extend loans. The focus of this course is credit analysis and lending. It provides an overview of lending principles, covers analytical aspects such as the financial analysis of a firm to determine credit worthiness, provides an overview of policy and legal issues, and looks at special types of credits like consumer loans, real estate loans, corporate loans and international loans. It also covers related topics such as securitisation, portfolio management and problem loan management.
Course learning outcomes
On successful completion of this course, students should be able to:
- synthesise credit assessment and lending knowledge, concepts, regulations, theories, principles and processes relevant to bank loans officers across a range of banking activities and loan types;
- think critically, constructively and logically about lending issues, ethical issues, theories and problems arising from asymmetric information and strategies that banks use to lessen the negative impacts of such problems;
- apply the tools of credit analysis and lending management to solve problems faced by banks in assessing loans and managing loan portfolios;
- confidently and coherently communicate insights gleaned through financial statement analysis and credit assessment of borrowers to an appropriate audience;
- demonstrate the information literacy skills required of a financial services professional through reading and interpreting financial statement information and other relevant financial metrics and discussing loan products and facilities and other banking services.
Topics
| Description | Weighting(%) | |
|---|---|---|
| 1. | The principles of lending and lending basics | 8.00 |
| 2. | Financial statements analysis | 10.00 |
| 3. | Credit scoring techniques | 8.00 |
| 4. | Credit risk 1 | 9.00 |
| 5. | Credit risk 2 | 9.00 |
| 6. | Consumer lending | 8.00 |
| 7. | Real estate lending | 8.00 |
| 8. | Security, consumer credit legislation and legal aspects of lending | 8.00 |
| 9. | Corporate lending | 8.00 |
| 10. | Small business lending | 8.00 |
| 11. | International lending | 8.00 |
| 12. | Problem loan management | 8.00 |
Text and materials required to be purchased or accessed
(etext available from: www.cengagebrain.com.au.)
Student workload expectations
To do well in this subject, students are expected to commit approximately 10 hours per week including class contact hours, independent study, and all assessment tasks. If you are undertaking additional activities, which may include placements and residential schools, the weekly workload hours may vary.
Assessment details
| Description | Group Assessment |
Weighting (%) | Course learning outcomes |
|---|---|---|---|
| Quiz 1 | No | 10 | 1,2,3,5 |
| Problem Solving | No | 30 | 1,2,3,4,5 |
| Quiz 2 | No | 20 | 1,2,3,5 |
| Time limited online examinatn | No | 40 | 1,2,3,5 |