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Lecture 45Recap
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1) Financial Environment Financial Institutions

• Role of Financial Institutions
• Long Run Performance of Financial Institutions
  for Economic Growth
• Capital Market
• Stock markets
• Bond markets

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• Commodity markets
• Money markets
• Derivatives markets
• Futures markets
• Borrowers of Financial Markets
• Lenders Of Financial Market

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2) Financial Institutions

• Types of Financial Institutions
• Central Bank
• Commercial Banks
• Investment Bank
• Saving Bank
• Micro Finance Bank

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• Financial Institution THEIR FUNCTIONS
• Islamic Bank
• Agriculture Bank
• SME Banks
• Non-Banking Financial Institutions

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• Investment Companies
• Brokerage Houses
• Leasing Companies
• Insurance Companies
• Mutual Fund

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3) Central Bank

• Activities Responsibilities
• Monetary Policy
• Central or National Bankers Bank
• Interest Rate Intervention
• Limits of Enforcement Power

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• Policy Instruments
• Interest rate Intervention
• Limits of Enforcement Power
• Interest Rates
• Open Market Operations
• Repo Market known as repurchase operations

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• Direct Operations
• Buying or selling securities ("Direct
  Operations")
• Foreign exchange operations such as forex swaps.
• Capital Requirements
• Reserve requirements
• Exchange Requirements

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5) Economic Factors

• Balance of Trade
• Balance of Payments
• Factors that can affect BOT
• Exchange rates
• Trade agreements or barriers
• Other tax, tariff and trade measures
• Business cycle at home or abroad.

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• Current Account Surplus Deficit
• Capital or Financial Account Surplus Deficit
• Balance of Payments Equilibrium
• Challenges of a Central Bank
• Economic Growth
• Poverty Reduction
• Inflation
• Stability in Forex Rate

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5) State Bank of Pakistan

• History
• Functions
• Primary Function
• Secondary Function
• Non-Promotional Function
• Regulation of Liquidity
• Banking Assets Liabilities

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6 to 11) Various Departments of State Bank of
Pakistan

• Agricultural Credit
• Audit
• Banking Inspection
• Banking Policy
• Banking Supervision
• Corporate Services

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• Economic Policy
• Exchange and Debt Management
• Exchange Policy
• Human Resource
• Information System
• Islamic Banking

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• Legal Services Department
• Research Department
• Small and Medium Enterprises

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11 12) Macro Economic Performance of a Country

• National Income
• Concepts of National Income
• Difference b/w GDP GNP
• Regulating risk and the importance of risk
  management
• Basel 2 Type Rules for Insurers
• GLOBAL FINANCIAL SYSTEM

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• INTERNATIONAL FINANCIAL INSTITUTIONS
• International Monetary Fund
• The World Bank
• World Trade Organization
• Role of WTO in Pakistan Trade Environment
• Asian Development Bank
• ADB Projects in Pakistan
• Paris Club

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13) Pakistan Economic Aid Debt

• The major causes of poverty in Pakistan
• Key challenges facing the Government of Pakistan
• Future Prospects for Pakistan's Economy
• Macroeconomic Stability
• Strengthening Institutions

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14) Increasing Foreign Direct Investment

• Foreign Interest in Local Financial Markets
• Enhancing and Sustaining a Growing GDP
• How can Pakistan improve and sustain its growth
  rate?
• Industrial Sector

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• Inter-provincial harmony in Pakistan
• Achieving a Favorable Balance of Trade
• Managing the Debt
• Economic Resilience

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15 to 19) Role of Commercial Banks

• Purpose of a bank
• Commercial Lending
• Banking Services
• A Banks Profit
• Services Typically Offered by Banks
• Types of banks
• Banks in the Economy

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• Role in the money supply
• Size of Global Banking Industry
• Bank Crisis
• Challenges within the Banking Industry
• Economic Environment

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• Growth Strategies
• The Management of the Banks
• Public perceptions of banks
• Profitability

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• SWIFT Society for Worldwide Interbank Financial
  Transactions
• COMMERCIAL BANKING IN PAKISTAN
• CAMEL
• 1) Capital Adequacy,
• 2) Asset Quality,
• 3) Management Soundness,
• 4) Earnings and Profitability,
• 5) Liquidity and Sensitivity to Market Risk.

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• Deposit Mobilization
• Credit extension
• Banking spreads
• Asset composition
• Problem bank management

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BANKING SECTOR REFORMS in Pakistan

• Privatization of Nationalized Commercial Banks
• Corporate governance.
• Capital Strengthening.
• Improving Asset quality.
• Liberalization of foreign exchange regime
• Consumer Financing

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• Mortgage Financing
• Legal Reforms
• Prudential Regulations
• Micro financing
• SME Financing
• Taxation

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• Agriculture Credit
• E-Banking
• Human Resources
• Credit Rating
• Supervision and Regulatory Capacity
• Payment Systems

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20) Branch Banking in Pakistan

• Remittances
• Demand Draft
• Telegraphic Transfer
• Mail Transfer
• Online Fund Transfer
• Types of Account

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• Individual
• Joint Account
• Sole Proprietorship
• Club Societies
• Joint Stock Companies
• Agents

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Operations Status of Accounts Nature of Accounts

• Current Account
• Profit Loss Sharing
• Current foreign currency
• Saving Foreign Currency
• Term Deposits
• BBA Basic Banking Account

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• Types of Loan
• Personal finance
• Mortgage Finance
• Business Finance

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21) Role of Commercial Banks in Micro Finance
Sector

• Micro credit
• Micro insurance
• Micro finance sector in Pakistan
• Micro finance banks in Pakistan

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22 to 26 ) Mutual Funds

• What is mutual funds
• Turnovers
• Expenses
• Management Fees
• Non-management Expenses
• Service Fees
• Fees and Expenses Borne by the Investor (not the
  Fund)
• Brokerage Commissions

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• Types of mutual funds
• Open-end fund
• Exchange-traded funds
• Equity funds
• Capitalization
• Growth vs. value
• Index funds versus active management

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• Bond funds
• Money market funds
• Funds of funds
• Hedge funds
• Mutual funds vs. other investments
• Share classes
• Load and expenses
• Criticism of managed mutual funds

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28) Investment Banking

• Organizational structure of an investment bank
• The main activities and units of Investment Banks
• Size of industry
• Recent evolution of the business
• New products
• Possible conflicts of interest
• Types of Investment banks

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29 30) Letter of Credit International Trade

• Terminology
• How it works
• Legal principles governing documentary credits
• The price of LCs
• Legal Basis for Letters of Credit
• Risks in International Trade

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31 32) Foreign Exchange Role of Financial
Institutions

• Market size and liquidity
• Market participants
• Banks
• Commercial companies
• Central banks
• Investment management firms
• Hedge funds
• Retail forex brokers

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• Trading characteristics
• Factors affecting currency trading
• Economic factors
• Political conditions
• Market psychology
• Algorithmic trading in forex

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• Financial instruments
• Spot
• Forward
• Future
• Swap
• Option
• Exchange Traded Fund
• Speculation

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33 34) Leasing Companies

• Conceptual background
• Leasing of real property
• Leasing of tangible personal property
• Real leases
• Private property rental
• Commercial leasehold
• Advantages of commercial leasing
• Disadvantages of commercial leasing
• The Leasing Sector in Pakistan and its Role in
  Capital Investment

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35 36) Insurance Companies

• Principles of insurance
• Indemnification
• When is a policy really insurance?
• Does the contract contain adequate risk transfer?
  
• Is there a brightline test?
• "Safe harbor" exemptions
• Risk limiting features

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• Insurers business model
• Gambling analogy
• History of insurance
• Types of insurance
• Types of insurance companies

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• Life insurance and saving
• Size of global insurance industry
• Financial viability of insurance companies
• Controversies
• Insurance insulates too much
• Closed community self-insurance
• Complexity of insurance policy contracts

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• Redlining
• Health insurance
• Dental insurance
• Insurance patents
• The insurance industry and rent seeking
• Criticism of insurance companies

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• 37) Role of Financial Institutions in Agriculture
  Sector
• 39) SME sector Financial Institutions
• SME Policy in Pakistan
• Government of Pakistan its Role

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40) Financial Crimes

• Money Laundering
• Modern development
• Process
• Irregular funding
• Captive business
• Legal considerations

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• Fighting money laundering
• Using information technology
• September 11, 2001 and the international response
  to the underground economy

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• 41) Financial Institutions Risk Management
• 42) Banking Crimes
• 43) Collapse of Enron
• 44) Misleading in Baring Bank, Black Wednesday,
  Soloman Brothers and Treasury Fraud.