3803727: Profit and risk management

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Semester:WS 14/15
Scheduled in semester:1
Semester Hours per Week / Contact Hours:16.0 L / 12.0 h
Self-directed study time:93.0 h

Module coordination/Lecturers


Master's degree programme in Banking and Financial Management (01.10.2008)


Profitability Analysis

  • Single Transaction-Based ROI Analysis
  • ROI Analysis with the Aid of Comprehensive Institute Related Result Information

Planning and Monitoring of Target Figures in Profitability Management
  • Determination of Target Figures on the Comprehensive Bank Level
  • Determination of Debit Margins/Minimal Margins in Customer Transactions

Introduction to Risk Management
  • Risk Controlling in the Concept of Profit-Oriented Bank Management
  • Conception of Bank-Internal Risk Measurement
  • Risk Calculation in Profit-Oriented Bank Management

Change in Interest Rates Risk Management
  • Concept and Characteristic of Change in Interest Rate Risk
  • Analysis of Change of Interest Risk
  • Controlling Change of Interest Rate Risk

Credit Risk Management
  • Fundamentals of Credit Risk Control
  • Quantifying Credit Risk
  • Concepts and Measures to Limit Credit Risk

Learning Outcomes

  • Analysing bank profitability management
  • Identifying key indicators and target values
  • Itemising and evaluating bank risk control
  • Comparing basic procedures in risk management and their application
  • Presenting and illustrating risk calculations
  • Explaining interest rate change risk and selecting appropriate concepts for control
  • Quantifying bank credit risk and recommending methods for minimising these risks


Lectures Method

Interactive lecture with exercises


Recommended reading:

  • Resti, A. & Sirona, A. (2007). Risk Management and Shareholders' Value in Banking: From Risk Measurement Models to Capital Allocation Policies. John Wiley & Sons.

Additional reading:
  • Hull , J. (2009), Risk Management and Financial Institutions, 2th ed., Prentice Hall: Upper Saddle River, NJ.
  • Matten, C. (2000), Managing Bank Capital, 2th ed., Wiley: New York.
  • Bank, M./Gerke, W. (2005), Finanzierung II, Kohlhammer Verlag.
  • Jorion, P. (2007). Value at Risk. New York: Mc Graw-Hill.
  • Crouhy, M./ Galai, D./ Mark, R.(2007). Risk Management. New York: Mc Graw-Hill.
  • Saunders,A./Millon Cornett, M. (2008), Financial Institutions Management, 6th ed., Mc Graw-Hill: New York.


Lecture slides, exercises, sample questions will be available on Moodle

Exam Modalities

  • Written examination with 90 minutes editing time (70%)


12.12.201413:15 - 16:30H4
13.12.201409:00 - 12:15H4
19.12.201409:00 - 16:30H4