FINANCE 4324: COMMERCIAL BANK MANAGEMENT (3 credit hours)
FALL 2009 SYLLABUS
Classes: 10:30 - 11:50 a.m. on Monday and Wednesday (BA2 207)
1:30 - 2:45 p.m. on Monday and Wednesday (BA1 116)

Instructor: Dr. Stanley D. Smith, Professor of Finance  (Profile of Professor Smith)

Office: BA 410                                                Phone:  (407) 823-6453
E-mail: ssmith@bus.ucf.edu                             FAX: (407) 823-6676
Web Page: http://www.bus.ucf.edu/ssmith

Prerequisite: A passing grade in Financial Markets, FIN 3303. Any student who does not meet this requirement MAY BE DROPPED from the class and may not receive a refund of tuition and it may be too late to add another class. IF YOU DO NOT MEET THIS REQUIREMENT, DROP THIS COURSE IMMEDIATELY.

EXPECTATIONS: This course is an elective. The assumption is made that the student has an interest in commercial banking. This course requires a lot of discipline in keeping up with the work. In addition, senior students near graduation are expected to exhibit professional behavior, including attending class and coming to class on time.

"Eighty percent of success is showing up."  -  Woody Allen

To avoid distractions in class, no electronic devices, such as laptop computers, telephones, PDAs or tape recording devices, may be used in class by the students.  For exams, the student is expected to bring a financial-type calculator that is commonly used in most finance classes.  Calculators or phones that have text entry are not allowed for exams. 

Cell Phone Policy:  If a student's phone rings in class then the student's course average will be lowered one point for each occasion.

Textbook: Bank Management & Financial Services, Peter S. Rose and Sylvia Hudgins, 8th edition, 2010, McGraw-Hill/Irwin Publishing Company. ISBN 0697785696.  It is a Black & White text with a soft cover.  This is a special edition of the regular textbook that is designed for this course.  In the class schedule and notes the page numbers refer to the page numbers for the whole text.  This text should be considerably cheaper than the regular hard back, colored text that includes more chapters than we will use.  This is the first semester for the use of this text so there will not be any used versions.  A used version of the whole text that includes Chapter 2-18 would work.  The ISBN for the whole text is 978-0-07-724592-4.

Office Hours and Other Contact Information: Office hours will normally be 9:30 -10:15 a.m. and 3:00-4:00 p.m. on Monday and Wednesday or by appointment. Please feel free to contact me in person; however, if that is not convenient, I am very conscientious about checking and responding to my E-mail and voice mail. When e-mailing me be sure to put "CBM" or "FIN 4324"  in the subject line and any other information that is relevant to the subject.  Professors receive a lot of spam mail and the inclusion of CBM in the subject is to make sure that your message is not accidentally deleted. 

Course Description: An analysis of the interactions of commercial banking policies and an analysis of current approaches to managing specific bank products.

Course Objectives: To provide an in-depth analysis of complex bank management issues.

The approach in this class is to teach the student about producing and pricing financial products.  We will use many international examples and discuss the domestic and international financial and regulatory systems bankers face.  We will use recent examples and take the producer's point of view but this perspective is also important as a buyer of these products as a financial analyst or business financial manager.  If you are going to be an effective buyer of these products for yourself or others, you need to understand as much as possible about what the seller of the product knows.  Examples include:

Real Estate Lending - Consumer or Commercial,
Commercial Lending - Small or Large Businesses,
Consumer Lending - Auto, Personal, or Credit Cards,
Deposit Management - Retail or Wholesale,
Liquidity and Cash Management,
Asset/Liability Management,
Capital Management,
Mortgage Banking,
Fee Income Production (Fiduciary activities, service charges on deposits),  
New methods of delivery - Internet Banking, retail store branches, smart cards, or call centers,
Management of payments systems.

 

Course Topics and Grading Weights:

Exams - Three exams worth 30% each of your course grade will be given.  Scantron forms will be needed for the exam and this requirement is the student's responsibility.  If a student misses an exam he will take a comprehensive final exam that will count for the missed exam and the last exam.  The material and the associated exams are subject to change and may be found at http://www.bus.ucf.edu/ssmith/cbmsc09fall.htm. (NOTE:  The information on this site is tentative, may still contain information for the past semester, and does not yet fully reflect the material for fall 2009.)  You are expected to take the exams at the normal time with your specific class.  The material is cumulative in that future lectures are based on past lectures. 
 

Students who plan to miss class for Authorized University Events (must present official authorization), and Religious Holidays, should contact the instructor during the first two weeks of class or as soon as the actual or potential event or holiday are known to the student to schedule a make-up exam.   

Project - The project is worth 10% of your course grade.  Each student must chose a different bank holding company (BHC) and be approved by the Prof. Smith. They will be accepted on a first-come, first-selected basis.  The project has 10 key financial ratios of interest with four pieces of analysis for each ratio, e.g., the ratio, what is the percentile for the peer group, is the ratio better or worse than the peer group, and is the ratio better or worse than the previous period) for a total of 40 points.  The information comes from a 27-page bank performance report that will be discussed in class during the semester.  The assigned date for the information to be used in the project will be provided in class and we will try to use the most recent information at the time we cover the related material in the class.  Directions may be found at www.bus.ucf.edu/ssmith/BHCAnalysisProject.doc, and a list of large BHCs may be found at www.bus.ucf.edu/ssmith/BHClistA.xls and www.bus.ucf.edu/ssmith/BHClistFL.doc (this list includes many Florida-based BHCs).  Selection of  each student's bank holding company for the class project is due by September 2, 2009 and has to be approved by the instructor.  Each day that the selection is late will cost the student 5% of the class project grade for each late calendar day.  The projects are DUE on Monday, November 16, 2009.  If a project is turned in late, the penalty will be 10% of the project grade for each calendar day that it is late.

UCF Grading Policy statement

Starting with the Fall 2001 Semester, instructors may award plus and minus grades in undergraduate and graduate classes if they desire.  While this option is not mandatory, many faculty have expressed a preference for the greater exactness plus and minus grades provide. 

There is no official policy on the relation between the letter grade and the percentage grade (for instance, an A- being equal to a grade of 90-92). It is up to the instructor to determine the equivalency and to notify the students.  The course percent scores and the corresponding grades and GPAs are given below. 
 
Course %        GRADE         GPA                              
90.00-100            A                 4.00                                     
87.0-89.99           B+               3.25                                                          
80.0- 86.99          B                 3.00                                       
77.0-79.99           C+               2.25                                     
70.0-76.99           C                 2.00                                     
67.00-69.99         D+               1.25
60.00-66.99         D                 1.00  
Below 60.00         F                  0.00      

 
Did I make a good effort to succeed in FIN 4324?  Many of the students in this class expect to graduate this semester or soon.  Those expectations do not guarantee a C or higher in this class.  You have an obligation to make a good effort to succeed in this class.  Most students who follow the following guidelines will pass this course while those who do not follow the guidelines often do not succeed and do NOT GRADUATE on time.  During the fall 2007 semester, 83 students took the first test.  Ten percent of the 83 dropped before the withdrawal deadline and 19 percent earned a grade below a C.  Of the students who missed one of the first two exams, 2/3 earned a grade below a C.  I do not recall any student taking this class a second time that did not earn a C or higher, with a fair percentage of them earning a B or A.  The point of this comment is to illustrate that everyone in the class probably has the ability to pass the course if they decide to put for the effort and commitment that is necessary.

The class notes are often directly related to the text or other assigned readings.  Before each class you should print the notes for that class and review them so you have an idea of what you may not understand and what questions you should be asking in class during the lectures.  Many important tips on the class and the exams are provided at the very beginning of class, so it is important to be seated in class and ready to go when the class begins.  Prof. Smith stresses what he thinks is important during the lectures so it is necessary to make notes on what he stresses.  After the exams you will be able to see that he stresses almost everything that was on the exam.

Prof. Smith believes that a finance student should understand the financial logic underlying most formulas; therefore, he does not provide formulas on exams.  This approach bothers some students who have generally been provided formulas for exams.  If all you learn is for someone to give you a formula and the numbers and put the numbers in the formula, what have you learned that has value?  Why should I hire you versus someone who has never had a finance class?  Why shouldn't I computerize what you are doing? 

Tentative Schedule - lecture/class numbers refer to the lecture numbers at www.bus.ucf.edu/ssmith/cbmsc09fall.htm.

Date        Lecture Number (L)

8/24,26       L1 & L2

8/31 & 9/2     L3 & L4 (Selection of BHC for Project Due by 9/2/09)

Labor Day Holiday:  Monday 9/7/09

9/9,14    L5 & L6

9/16,21      L7 & L8

9/23,28         L9 & Test 1

9/30 & 10/5    L11 & L12

10/7,12    L13 & L14

10/14,19    L15 & L16:  WITHDRAWAL DEADLINE IS Friday, 10/16/09

10/21,26    L17 & L18

10/28 & 11/2    L19 & Test 2

11/4,9    L21 & L22  Veterans' Day Holiday is Wednesday, 11/11/09

11/16,18    L23 & L24 and PROJECTS DUE on 11/16/09

11/23,25    L25 & L26   (Thanksgiving, 11/26/09)

11/30 & 12/2   L27 & L28

12/7              L29 (LAST DAY OF CLASS)

Final Exams Dec. 8 (TU) - 14 (MON)

Final exams will be given at the appointed time for this class and all students should plan on taking the exam then.

Final Exam for 10:30 Class is 10:00-11:20 a.m. on Monday, 12/14/09.

Final Exam for 1:30 Class is 1:00-2:20 a.m. on Monday, 12/14/09.

Commencement Dec. 18 or 19, 2009                               


Cheating Policy statement:  Office of Student Rights and Responsibilities University of Central Florida
 
YOUR ENROLLMENT STATUS MAY BE AT RISK!
 
Academic Dishonesty in any form will not be tolerated!!!
 
The University of Central Florida has recently started an account with turnitin.com., an automated system which instructors can use to quickly and easily compare each student's report to billions of web sites, as well as an enormous database of student papers that grows with each submission.  After submission of the paper, instructors receive a report that states if and how another author's work was used.
 
Violations of student academic behavior standards are outlined in The
Golden Rule, the University of Central Florida's Student Handbook. See
http://www.ucf.edu/goldenrule/ for further details.
 
1.  Cheating whereby non-permissible written, visual or oral assistance
including that obtained from another student is utilized on examinations,
course assignments or projects. The unauthorized possession or use of
examination or course related material shall also constitute cheating.
 
2.  Plagiarism whereby another's work is deliberately used or appropriated
without any indication of the source. Thereby attempting to convey the
impression that such work is the student's own. Any student failing to
properly credit ideas or materials taken from another has plagiarized.
 
3.  A student who has assisted another in any of the aforementioned breach
of standards shall be considered equally culpable.
 
ACADEMIC ACTION
* Taken by Instructor, Chair, or Dean of College*
 
1.  Counseling
2.  Loss of credit for specific assignment, examination or project.
3.  Removal from course with a grade of "F"
and/or
CONDUCT REVIEW ACTION
*Taken by the Office of Student Conduct*
1.  Warning
2.  Probation
3.  Suspension
4.  Expulsion
5.  Permanent conduct record with UCF accessible by other institutions by request.
 
For more information, please contact the Office of Student Conduct at 823-2851.