Banks’ liability management
The 2008 global financial crisis was partly caused by banks’ failure in liability management (or funding management). a. Contrast between deposit and non-deposit
liability sources by highlighting differences in their funding costs as well as other non-cost implications (for instance, risks, market factors, etc.). Your
discussion should be supported by real-life examples. (Guide: 1000 words, 16 marks) Aim: Students must show understanding of four (4) differences from a theoretical
perspective, supported with real-world examples. For each difference discussed, 2 marks are awarded for a theoretical explanation and 2 marks for examples. b. Comment
on the relative importance of different liability items on a specific Australian bank balance sheet. (Guide: 300 words, 6 marks) Aim: Students must include the balance
sheet of the chosen bank in their essay, calculate the proportions of three (3) liability items and comment on their relative weight. 2 marks for each item discussed.
c. Download Orbis data for four (4) Australian commercial banks during 2012-2016 with regard to their liability mix and construct two (2) graphs that illustrate the
trends in their liability mix over these years. Each graph is a line chart containing four (4) lines for the chosen banks. Based on these graphs, comment on
differences between banks (peer analysis) as well as changes over time (trend analysis). (Guide: 500 words, 8 marks) Aim: Download relevant data from Orbis or banks’
annual reports from 2012 to 2016, present them meaningfully in line charts for the 4 chosen banks, and provide trend and peer analyses. 4 marks are allocated to each
graph (2 marks for the graphical presentation and 2 marks for trend and peer analyses). Note: Approximately 200 words are recommended for introduction and conclusion
together. Subheadings should be used to separate parts a, b and c. Word limit: 2,000 words (±10%), excluding references and appendices.
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