RSM428H1 Lecture Notes - Lecture 1: Fair Value, Merchant Bank, Commercial Bank
Document Summary
Administrative: weekly assignment due beginning of class each week, textbook is out of date but is still conceptually valid, no midterm, group assignment (groups of 4) Does not want us to use excel: use sas, stata, r, etc. Objectives: understand financial statements of the banking firm under ifrs. Important ifrs"s: ifrs 7: financial instruments: disclosures. Estimates of fair value come from implications of this: ifrs 9: financial instruments, classification and measurement of financial instruments b, hedging accounting. Impairments: ifrs 13: fair value measurement, ifrs 17: insurance contracts. Financial institutions: financial institutions include banks, stock brokerage houses, insurance companies, finance companies, credit unions, trust companies, will focus on large commercial banks. Different from nonfinancial firms: financial institutions are evaluated differently from non-financial firms, assets and liabilities of nonfinancial firm are rarely well matched in terms of risk characteristics. Are analyzed separately in most respects, except when firm is in financial distress: miller-modigliani: value of firm is independent of capital structure.
