Over the past 30 years or so the process of securitisation has become a well-established practice in banking institutions globally. In the wake of the financial crisis (2007-8), however the process was criticised and identified as one of the contributing factors to the crisis.
In this context, critically evaluate the assertion that the process of securitisation helped to contribute to the financial crisis. Identify the rationale for this assertion and suggest to what extent you agree with this argument.
? The requirement is to write an essay, not a report.
? The word count excludes references and tables, but the limit of 2,000 must not be exceeded.
? You must put the word count at the end of the essay.
? Use Times New Roman as the font style, with size 12 as the font size and fully justify the text.
? You should base the discussion and support your views / arguments / conclusions by reference to the thoughts of others that you will have read in the literature.
? You should also support your views and statements that you make by providing, where appropriate, up-to-date examples from the banking / regulatory and financial services sector;
? Correct use of the Harvard referencing system is required and all sources used must be fully acknowledged in the essay and its reference list
(i) to develop individual research skills;
(ii) to enhance ability to assess researched material and utilise it to develop logically structured discourse;
(iii) to develop awareness and understanding of conceptual issues in risk management in banking and in the application of risk management theory in a given context;
(iv) to develop essay-writing ability and referencing skills.
? Students should refer initially to Lecture 2 The Financial Crisis 2007-8 and Lecture 9 Securitisation, along with the tutorial questions relating to the lectures. (These two files will be uploaded later.)
? Additionally, students should refer to the Course Handbook for relevant chapters from the Reading List relating to Securitisation.
The Reading List from Course Handbook
Heany, V. (2009) Pure poison, Financial World, March, pp. 29-30.
Page, S. and Winter, M. (2001) Putting the “A” back into “ALM”, Balance Sheet, Vol.9, No.1, pp.10-13.
BIS. (2011) Securitisation is not that evil after all. Basel: BIS Working Paper 341