BFC5280 S2 2023

Final Take-Home Assessment

This is an individual assignment.

The word limit of 2000 (±10%) words, excluding references.

Learning Objectives:

This assignment has been designed to achieve the following learning outcomes:

LO1: Reconcile theory and bank practice in the areas of interest rate risk, market risk, loan risk, loan portfolio risk, foreign exchange risk, liquidity risk and risks associated with financial derivatives.

LO2: Identify and evaluate various risk measurement and risk management techniques used by financial institutions.

LO3: Develop critical skills in applying the BIS standardised and internal capital models utilised for assessing banks’ regulatory risk.

LO4: Demonstrate the acquisition of a comprehensive understanding of the topics covered in BFC5280.

Resources:

You will need access to the below resources to complete this take-home final assessment.

1. Course Moodle Page of BFC5280: Tab titled “Final Take-Home Assessment 2023 Semester 2”

2. Relevant Lecture Notes of BFC5280.

Please, access the Section titled “Final Take-Home Assessment 2023 Semester 2”. This section includes the following resources:

1. The main case:

▪ The link to the Harvard Business Publishing, case title: “Deutsche Bank

Restart: Goodbye the Goldman Sachs of Europe”

2. Important Instructions and Frequently Asked Questions (FAQs) Conditions for the use of generative artificial intelligence (AI):

Generative AI tools cannot be used in this assessment task: In this assessment, you must not use generative artificial intelligence (AI) to generate any materials or content in relation to the assessment task.

Case Questions:

Please, prepare evidence-based responses to the following questions. Your responses will be evaluated based on how well you understand and connect the relevant underlying concepts. We suggest referring to relevant Exhibits/Figures to interpret and relate your answers/findings where applicable.

Question#1: (3 Marks)

Identify DB’s strategic reasons behind the restructuring plan. Comment on the likelihood of this restructuring plan to be successful one.

Question#2 (3 Marks)

Comment on the restructuring plan for DB whether it’s consistent with its vision of being the “golden Sachs of Europe”.

Question#3 (3 Marks)

In which areas do you think DB has competitive advantage over its peers? You may use relevant figures/ratio etc to compare and explain.

Question#4 (3 Marks)

How likely the restructuring plan would affect the synergies between Global equities trading (closing an entire unit) and other business units.

Question#5 (3 Marks)

Comment on the market reaction to the restructuring plan with specific reference to risk and return trade-off.

Question#6 (4 Marks)

Describe the notion of “Bad Banks”. Do you agree that the restructuring plan was necessarily a creation of a “bad bank”? Why or why not?

Question#7 (3 Marks)

Comment on the risk management culture of DB in light of regulatory and legal aspects.

Question#8 (3 Marks)

Identify the key risks that DB is exposed to and why.

Question #9: Video Presentation (5 Marks)

What recommendations do you have for the DB’s CEO and why?

You are NOT required to provide a written response to this question (Question#9). You are required to prepare a 3-minute (maximum) video presentation with your proposed recommendations. Please prepare 3-5 PowerPoint presentation slides to facilitate preparing the video presentation.

Please, see the Important Instructions and Frequently Asked Questions (FAQs) document in the “Final Take-Home Assessment 2023 Semester 2” tab in the course Moodle Page for detailed instructions.