Xavier Institute of Management, Bhubaneswar

XIM UNIVERSITY

Course Name Financial Institutions and Markets (FIM)

Programme MBA-BM
Batch 2023-2024
Term I
Credits 2
Course Instructor Prof. Sridhar Dash & Prof. Punam Prasad

Course Introduction and Objectives

Financial Institutions and Markets (FIM) course is the foundation for the understanding of the
basic financial structure of the economy, financial market functioning, the process of
intermediation and the varied institutional arrangements for the successful functioning of the
financial system. The course will give an overview of different components of financial markets,
which will be an input to understand other finance related courses that will be offered going
forward.

Course Content
 An overview of Indian Financial System
 Role of Markets and Implications of the Market Imperfections
 Understanding Interest Rate
 Money Market & Bond Market and Institutions
 Stock Market and Institutions
 Alternative Sources of Risky Capital
 Foreign Exchange Market and Institutions
 Derivative markets and connecting the dots Across Markets
 Financial Intermediaries and Indirect Financial Market
 Overview on regulatory aspect

Course Learning Outcomes (CLO)

On successful completion of this course, students will be able to:
CLO I: In a given situation, the students will be able to how financial markets and its
intermediaries integrate to contribute to the economic development.

CLO II: In a given situation, the students will be able to able to understand why interest rate

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 is an input to decision-making process for managers.

CLO III: In a given situation, the students will be able to analyze the functioning of various
segments of the financial markets, institutions and instruments available.

Readings Materials, Prescribed Text Book, Reference Book, References, and Important
Websites details.
Referred Book
 Financial Institutions and Markets by Jeff Madura – Cengage Pub. (JM)

Other Reference Book

 Financial Market And Institutions by Mishkin,Eakins, T Jayakumar & R.K.Pattanaik-
Pearson 8th ed.
 Finance and Financial Markets by Keith Pilbeam-MacMillan Pub. (KB)
 Financial Institutions & Markets by Bhole & Mahakud- Tata McGraw Hill-latest ed

References

 Annual Report of SEBI.

 Annual Report- Reserve Bank of India.
 Annual Report of Ministry of Finance, GOI.

Important Financial Web Address

www.livemint.com.
www.rbi.org.in/Scripts/financialmarketswatch
http://www.fimmda.org/, note: FIMMDA stands for Fixed Income Money Market and
Derivatives Association of India.
http://www.ccilindia.com/OMHome.aspx, note CCIL stands for Clearing Corporation of
India Ltd.
www.amfiindia.com, note AMFI stands for Association of Mutual Funds in India.
http://www.stcipd.com/, note STCIPD stands for STCI Primary Dealer Ltd.
http://www.nseindia.com/, Note NSE stands for National Stock Exchange India Ltd.
http://www.bseindia.com/, Note BSE stands for Bombay Stock Exchange India Ltd.

Assessment Scheme

Component Weightage (%) Assessment of Course Learning

Outcome(s) (CLO)
Quiz I 20% CLO I
Quiz I 20% CLO II & CLO III
Group Project/Assignment 20% CLO I, CLO II & CLO III
End-Term 40% CLO I, CLO II & CLO III

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Pedagogy and Students Workload
The course will be delivered through lectures as per the session wise schedule given below.
Students are encouraged to read financial newspapers (Mint, Business Standard, Business line,
Economic Times, The Financial Express etc.) and bring out points for discussion to the class to
see the linkages between class lectures and what is happening in business world as well as
regulatory environments. In the lecture sessions, the students are expected to come to the class
with acquaintance of pre-reading materials for effective learning outcomes. In projects
preparation and presentation, each member of the group is expected to have active involvement.

The quizzes will be of MCQ types. The end-term paper would cover entire course syllabus, and
will test understanding of the subject. Group Project details will be shared separately during the
class.

Academic Discipline and Integrity

Students are expected to come to class on time. Academic Integrity will be adhered as per the
norms and policy given by the Institute. No interchange of section attendance is permissible.
Students are not allowed to use cell phone and laptop inside the class without permission of the
faculty. Any plagiarism beyond 20% found in the submission (including reproduction from
books,
online sources, journals or from peers) will NOT be accepted.

Session Plan
Session Topics covered Session Learnings Readings

This session will focus on discussing

of how Indian financial system
works, and will discuss how
different stakeholders are driving the
functioning of the market. Context of
An Overview of Indian the discussion will be from a JM : Ch 1
Session 1
Financial System manager’s perspective who is KB: Ch 1
looking for sources of capital to
invest. Special emphasis will be
given on flow of financial assets and
liabilities.

This session will focus on role

markets perform in allocating
Role of Markets and financial resources. Given that
Session 2
Implications of the Market markets are prone to failure, this Readings to be given
Imperfections session will cover basics of market
failure and what are the implications.

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 These sessions will discuss the
drivers of interest rate, and how the
existing regulatory framework
Session signals to the business managers.
Understanding Interest Rate Besides, we will also discuss how JM : Ch 2 & 3
3 managers need to take interest rate as KB: Ch 4
an input for their decision-making
process. The session will also cover
basic financial mathematics.
This session will discuss who are the
players in money market, and how
does it work. Basic understanding on
Session Repo Market, T-Bill Market,
Understanding Money Commercial Papers, Certificate of JM : Ch 6
4&5 Market and Institutions Deposits and Bills market will be KB: Ch 5
dealt. we will discuss how the
dynamics in money markets affect
the interest rate and pricing of money
market instruments.
These sessions will discuss the
instruments available in bond
Session
Understanding Bond market, and how does it work.
JM : Ch 7 & 8
Market and Institutions Besides, we will discuss the
6 KB: 6
relationship between price of the
bond and interest rate.

These sessions will discuss how

stock market works, and how does it
signal to managers. Besides, we will
Session 7 Understanding Stock discuss about the process and pricing
JM : Ch 10 & 11
Market and Institutions of initial public offering (IPO),
follow up public offerings (FPO),
and private placement process.
This session will discuss alternative
sources of risk capital like private
Session 8 Understanding Alternative
equity, InVIT, REIT and how does Readings to be given
Sources of Risky Capital this market work. This discussion
will be at very basic level.
This session will discussion how
Understanding Foreign
does foreign exchange market works,
Session 9 Exchange Market and and how does exchange rate affect KB: Ch 11 &12
Institutions managerial decision making. This
discussion will be at very basic level.
In this session, a brief discussion on
Brief discussion of derivative derivative market will be discussed
Session markets and connecting the along with an attempt will be made
dots Across Markets to see the linkages across various Readings to be given
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markets to develop a holistic
understanding of the subject.

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 These sessions will discuss the basic
Session 11 Financial Intermediaries instruments offered by Commercial
and Indirect Financial Banks, and the financial flows KB: Ch 2
& 12 Market between Banks, Commercial sectors
and Government Sector.
These sessions will discuss the
Session 13 Regulatory aspect of regulations with respect varied
Financial market norms banking, insurance, stock
market and mutual funds sector.
Session 14
Group Project presentation Group Project presentation

Academic Discipline and Integrity

Students are expected to come to class on time. Academic Integrity will be adhered as per the
norms and policy given by the Institute. No interchange of section attendance is permissible.
Students are not allowed to use cell phone and laptop inside the class without permission of the
faculty. Any plagiarism beyond 20% found in the submission (including reproduction from
books,
online sources, journals or from peers) will NOT be accepted.

Mapping Course Leaning Outcomes (CLO) with the Program Learning Goals (PLG)

PLG# Program Trait Addressed by Course

Learning Goal Yes No
PLG1 The students will demonstrate Yes
Functional and understanding of elements of all
Business Skills functional areas
PLG2 The students will use analytical Yes
techniques to identify a business
Analytical Skills problem, and suggest a solution
PLG3 Collaboration and The students will exhibit voluntary No
teamwork cooperation and effective teamwork
attributes in a group setting
PLG4 The students will understand the No
ethical complexities of conducting
business. The students will adopt
Ethical techniques in scenarios involving
responsibility ethical dilemma and offer resolution
PLG5 Communication The students will produce No
reasonably good quality business
documents. The students will
become effective and confident

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communicators