TREASURY BANKING PRACTICE AND OPERATIONS
Tutor: Mr Philips Mwanagala
STATEMENT ABOUT ACADEMIC HONESTY AND INTEGRITY
All students, upon signing this course outline, commit themselves to abide by the policies and rules of the institution. The core activity of ABN is learning and in this respect academic honesty and integrity is very important to ensure that learning is valid, reliable and credible.
ABN therefore does not condone any form of academic dishonesty, including plagiarism and cheating on exams and assessments, amongst other such practices. ABN requires students to always do their own assignments and to produce their own academic work, unless given a group assignment.
Academic Dishonesty includes, but is not limited to:
- Using the ideas, words, works or inventions of someone else as if it is your own work.
- Using the direct words of someone else without quotation marks, even if it is referenced.
- Copying from writings (books, articles, webpages, other students’ assignments, etc.), published or unpublished, without referencing.
- Syndication of a piece of work, all or part of an assignment, by a group of students, unless the assignment was a legitimate group assignment.
- The borrowing and use of another person’s assignment, with or without their knowledge or permission.
- Infringing copyright, including documents copied or cut and pasted from the internet.
- Asking someone else to prepare an assignment for you or to write or sit an assessment for you, whether this is against payment or not.
- Re-submitting work done already for another course or programme as new work, so-called self-plagiarism.
- Bringing notes into an examination or test venue, regardless of whether the notes were used to copy or not.
- Receiving any outside assistance in any form or shape during an examination or test.
All forms of academic dishonesty are viewed as misconduct under ABN Student Rules and Regulations. Students who make themselves guilty of academic dishonesty will be brought before a Disciplinary Committee and may be suspended from studying for a certain time or may be expelled. All students who are found guilty of academic dishonesty shall have an appropriate endorsement on their academic record, which will never be erased.
COURSE INFORMATION
COURSE: CERTIFICATE IN BANKING, FINANCE AND CREDIT
MODULE: TREASURY BANKING PRACTICE AND OPERATIONS
MODULE CODE: CTBPO 1000
MODULE DESCRIPTION:
The Treasury function in any corporate has always been important in making sure that the business has sufficient liquidity to meet its obligations, whilst managing payments, receipts and financial risks effectively. Current market conditions also reinforce the need for corporates to ensure that their financial position is managed as efficiently as possible, with no excess working capital tied up in the business - the old adage ‘cash is king’ is certainly as relevant today as it has always been.
Although the role of the Treasury function is constantly evolving, this module aimed at looking at the main interlinked categories, namely Planning and Operations, Cash and Liquidity Management, Funding and Capital Markets and Financial Risk Management
NQF Level: 5
PREREQUISITES: None
EXIT Learning Outcomes:
Upon successful completion of this module, students will be able to:
1. Understand basic liquidity and financial concepts
2. Grasp the concepts bank run, systematic banking crises and Great Depression.
3. Understand liquidity risk management.
4. Understand interest rate risk and the measurement methods used.
5. Have knowledge on various funding sources.
6. Comprehensively have knowledge on the treasury operations and products.
7. Understand the security and derivatives activities.
PRESCRIBED TEXT BOOK:
- Student guide TREASURY BANKING PRACTICE AND OPERATIONS
Module Content
Unit:
1. BASIC LIQUIDITY CONCEPTS
1. Liquidity Concepts
2. Cash Flow Concepts
2. BASIC FINANCIAL CONCEPTS
1. Financial Statement Concepts
2. Funding Concepts
3. Capitalization Concepts
3. BANK RUN AND LIQUIDITY POSITION
1. Meaning of Bank Run
2. Theory Explanation of Bank Run
3. Systematic Banking Crises
4. Prevention of Bank Run
5. Bank Run Triggered the Great Depression
6. Meaning of Liquidity
7. Meaning of Market Liquidity
8. Liquidity Risk
9. Liquidity is King
4. LIQUIDITY RISK MANAGEMENT
1. Importance of Interest Rates
2. Explaining Liquidity
3. Explaining Liquidity Risk
4. Liquidity Management
5. Board and Senior Management Oversight
6. Policies and Procedures
7. Management Information System
8. Internal Controls
9. Liquidity Warning Indicators
10. Liquidity Contingency Plan
11. Liquidity Component Factor
12. Rating the Liquidity Factor
13. Liquidity Ratio Analysis
5. FUNDING SOURCES: ASSETS AND LIABILITIES
1. Funding Sources: Assets
2. Funding Sources: Liabilities
6. TREASURY PRODUCTS
1. Money Market Products
2. Forex Market Products
3. Bond Market Products
4. Equity Derivative Market Products
5. Interest Rate Derivative Market Products
6. New Treasury Products
7. Issuance of Subordinated Unsecured Bond
7. TREASURY OPERATIONS
1. Introduction to Treasury Operations
2. Traditional Functions of the Back Office
3. Other Functions of the Back Office
4. Dependency of Treasury Operations on Skilled Human Resources
5. Risk Management of Treasury Operations in Banks
6. Types of Risks
7. Measurement of Interest Rate Risk
8. Main Functions of Treasury Department
9. What Does a Treasury Department Do in a Bank?
10. Importance of Treasury Operations
11. Role of Treasury Manager
8. SENSITIVITY TO MARKET RISK
1. Introduction
2. Types of Interest Rate Risk
3. Sources of Interest Rate Risk
4. Management Responsibilities for Interest Rate Risk (IRR)
5. Board and Senior Management Oversight
6. Risk Identification and Measurement
7. Other Market Risk Factors
8. Evaluation of a Bank’s Sensitivity to Market Risk
9. INTEREST RATE RISK MEASUREMENT METHODS
1. Introduction
2. Liquidity Risk
3. Measurement System Approaches
4. Gap Analysis
5. Simulation Analysis
6. Duration Analysis
10. SECURITIES AND DERIVATIVES ACTIVITIES
1. Introduction
2. Risk Management Process
3. Policies, Procedures, and Risk Limits
4. Internal Controls
5. Unsuitable Investment Activities
6. Risk Identification
7. Risk Reporting
8. Board and Senior Management Oversight
9. Investment Strategies
IMPORTANT DATES:
NOTE: The following dates are subject to change based on the needs of the students at the lecturer’s prerogative. Students will be notified ahead of time of any changes.
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ASSESSMENT AND EVALUATION: Continuous assessment 50%
Examination 50%; 1 x 3-hour examination paper
Minimum pass requirement for this course: 50%
COURSE POLICIES
General Academic Policies:
It is the student's responsibility to be familiar with and adhere to ABN’s Policies.
AUTHORISATION:
This course is authorised for use by:
___________________________________
__________________________
Head of Department Date
ACKNOWLEDGEMENT BY STUDENT
(To be completed by all students on the course, detached from the course outline and kept on record in the department)
I, (insert name), (Student number), hereby acknowledge that I have received this course outline for (insert course title and code), and that I have familiarised myself with its content, in particular the statement about academic honesty and integrity. I agree to abide by the Policies and arrangements spelt out in this course outline.
______________________ _______________________
Signature of Student Date
