COURSE INFORMATION Course Title: FINANCIAL INSTITUTIONS AND MARKETS

Code	Course Type	Regular Semester	Theory	Practice	Lab	Credits	ECTS
BAF 321	B	5	3	0	0	3	5

Academic staff member responsible for the design of the course syllabus (name, surname, academic title/scientific degree, email address and signature)	NA
Main Course Lecturer (name, surname, academic title/scientific degree, email address and signature) and Office Hours:	Dr. Etleva Gjonça egjonca@epoka.edu.al , Tuesdays, 11AM-1PM
Second Course Lecturer(s) (name, surname, academic title/scientific degree, email address and signature) and Office Hours:	NA
Teaching Assistant(s) and Office Hours:	NA
Language:	English
Compulsory/Elective:	Compulsory
Study program: (the study for which this course is offered)	Bachelor in Economics (3 years)
Classroom and Meeting Time:
Code of Ethics:	Code of Ethics of EPOKA University Regulation of EPOKA University "On Student Discipline"
Attendance Requirement:	75%
Course Description:	This course is about the financial institutions, markets, and instruments that compose today's global financial markets and the risks associated with them. Students will gain a thorough understanding of how financial institutions are managed, how funds are raised, how financial instruments are priced, how risks are managed, and why financial institutions and markets are prone to failure.
Course Objectives:	This course is intended to help you understand the role of financial institutions and markets play in the business environment that you will face in the future. It also helps you to develop a series of applications of principles from finance and economics that explore the connection between financial markets, financial institutions and the economy. On the financial markets side, we will learn the term structure of interest rates, stocks, principals of derivatives, and currencies. On the institutions side, we will learn commercial banks, investment banks, insurance companies, mutual funds, the Federal Reserve Systems and their role of in the economy

BASIC CONCEPTS OF THE COURSE

1	Financial markets are markets in which funds are transferred from people who have an excess of available funds to people who have a shortage.
2	Financial institutions are what make financial markets work.
3	A primary market is a market where new security, bond or stock, issues sold to initial buyers by the corporation or government agency borrowing funds.
4	A secondary market is a financial market in which securities that have been previously issued can be sold.
5	The concept of present value (or present discounted value) is based on the commonsense notion that a dollar of cash flow paid to you one year from now is less valuable to you than a dollar paid to you today.
6	Real interest rate is an Interest rate that is adjusted for expected changes in the price level.
7	An asset is a piece of property that is a store of value.
8	Bonds are securities that represent a debt owned by the issuer to the investor.
9	A share of stock in a firm represent ownership.

COURSE OUTLINE

Week	Topics
1	Introduction & Syllabus
2	Ch. 1 - Why study financial markets and Institutions & Ch. 2 - Overview of the financial system; Why study financial markets? Why study financial institutions? Function and Overview of the financial markets; Structure of financial markets: Function of financial intermediaries
3	Ch. 3 - What Do Interest Rates Mean and What Is Their Role in Valuation? Measuring interest rates: Distinction between real and nominal interest rates; Distinction between interest rates and returns;
4	Ch. 4 - Why Do Interest Rates Change?: Determinants of asset demand; Supply and demand in the bond market; Changes in Equilibrium Interest Rates
5	Ch. 5 - Risk and Term Structure: Risk Structure of interest rates: Term Structure of interest rates
6	Ch. 7 - Why Do Financial Institutions Exist?: Transaction Costs; Asymmetric Information; Moral Hazard
7	Review for the Midterm
8	Midterm
9	Ch. 11 - Money Market: The Money Markets Defined; Why do need money markets? The Purpose of the Money Markets;
10	Ch. 12 - Bond Market; Purpose of the Capital Market; Capital Market Participants
11	Ch. 13 - Stock Market; Investing in Stocks; Computing the Price of Common Stock
12	Ch. 20 - The Mutual Fund Industry: The Growth of Mutual Funds: Benefits of Mutual Funds
13	Ch. 21 - Insurance and Pension Funds, Insurance Companies: Fundamentals of insurance: Types of Insurance and Pensions
14	Review for the Final Exam

Prerequisite(s):
Textbook(s):	Financial Markets and Institutions ~ Mishkin & Eakins
Additional Literature:
Laboratory Work:
Computer Usage:
Others:	No

COURSE LEARNING OUTCOMES

1	To discuss theories that underneath the term structure of interest rates
2	To discuss efficient market hypothesis related to stock pricing
3	To understand a stylized bank’s balance sheet and discuss how risks are managed in banks
4	To discuss facts of the insurance business, mutual funds and investment banks
5	To know how currency value is determined the short run and long run

COURSE CONTRIBUTION TO... PROGRAM COMPETENCIES (Blank : no contribution, 1: least contribution ... 5: highest contribution)

No	Program Competencies	Cont.
Bachelor in Economics (3 years) Program
1	Students define the fundamental problems of economics	5
2	Students describe key economic theories	5
3	Students critically discuss current developments in economics	5
4	Students appropriately use software for data analysis	5
5	Students critically contextualize the selection of an economic problem for research within scholarly literature and theory on the topic	5
6	Students apply appropriate analytical methods to address economic problems	5
7	Students use effective communication skills in a variety of academic and professional contexts	5
8	Students effectively contribute to group work	5
9	Students conduct independent research under academic supervision	5
10	Students uphold ethical values in data collection, interpretation, and dissemination	5
11	Students critically engage with interdisciplinary innovations in social sciences	5
12	Student explain how their research has a broader social benefit	5

COURSE EVALUATION METHOD

Method	Quantity	Percentage
Midterm Exam(s)	1	40
Final Exam	1	45
Other	1	15
	Total Percent:	100%

ECTS (ALLOCATED BASED ON STUDENT WORKLOAD)

Activities	Quantity	Duration(Hours)	Total Workload(Hours)
Course Duration (Including the exam week: 16x Total course hours)	16	3	48
Hours for off-the-classroom study (Pre-study, practice)	16	1	16
Mid-terms	1	20	20
Assignments	2	8	16
Final examination	1	25	25
Other			0
Total Work Load:			125
Total Work Load/25(h):			5
ECTS Credit of the Course:			5

CONCLUDING REMARKS BY THE COURSE LECTURER