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Financial Markets and Institutions

Module description

This module provides a comprehensive introduction to the structure, functions, and importance of financial markets and institutions within the global financial system. It explores the mechanisms through which capital flows between savers and borrowers, the roles and types of financial institutions, and the various instruments traded in money, capital, and foreign exchange markets. Students will examine the regulatory frameworks that govern financial activity, understand the interdependencies between markets and institutions, and analyse the impact of financial innovation, central banking, and global economic developments on the functioning of the financial system. Ethical and sustainable finance themes, including ESG considerations and financial inclusion, are embedded throughout the module. Through theoretical foundations and practical case studies, learners will develop the knowledge and analytical skills required to understand financial systems and apply these insights in real-world banking and finance environments.

Module aims - intentions of the module

This module aims to provide a comprehensive overview of financial markets and institutions, emphasizing their roles in the allocation of resources and the facilitation of economic activity. Students will explore the structure, functions, and operations of key financial markets—such as money, capital, bond, and stock markets—and examine the roles of major financial institutions including banks, insurance companies, pension funds, and investment firms. You will be able to understand the management, performance, and regulatory aspects of financial institutions, with real examples and practical applications. Emphasis is placed on understanding how financial institutions and markets interact to influence economic performance and financial stability.

Intended Learning Outcomes (ILOs)

ILO: Module-specific skills

On successfully completing the module you will be able to...

• 1. Explain the structure, functions, and significance of key financial markets, including money, bond, stock, mortgage, and foreign exchange markets.
• 2. Examine the structure, competition, and instruments of financial institutions, including banks, mutual funds, insurance companies, and pension funds.
• 3. Assess the impact of financial regulation on banking operations, risk management, and industry competition.
• 4. Discuss the structure, sources and uses of funds for commercial banks.
• 5. Gather knowledge on various types of non-bank financial institutions and understand the key role the non-bank institutions play in the economy.
• 6. Investigate the functions and significance of non-bank financial institutions such as savings associations, credit unions, and finance companies in financial intermediation.
• 7. Analyse the role of the international financial system in global economic stability and cross-border financial transactions.

ILO: Discipline-specific skills

On successfully completing the module you will be able to...

• 8. Exhibit a comprehensive understanding of various markets, diverse asset classes and financial instruments.
• 9. Gain expertise with key financial instruments (e.g., bonds, stocks, derivatives) and how they are issued, traded, and priced in different markets.
• 10. Develop a solid understanding of the numerical calculations of pricing various financial instruments.
• 11. Analyse the interconnectedness of global financial markets and the implications of international financial developments.

ILO: Personal and key skills

On successfully completing the module you will be able to...

• 12. Foster critical thinking about current issues and developments in the global financial system.
• 13. Improve ability to interpret and analyse financial data, financial formulas and models.
• 14. Achieve proficiency in articulating financial concepts and presenting market insights clearly in written and verbal formats.

Syllabus plan

Indicative topics:

• Purpose and structure of financial systems
• Financial intermediation and economic development
• Overview of financial instruments and markets
• Debt Security Markets
• Equity Markets
• Derivative Security Markets
• Commercial Banking
• Non-Bank operations
• Global financial integration

Learning activities and teaching methods (given in hours of study time)

Details of learning activities and teaching methods

Formative assessment

Summative assessment (% of credit)

Details of summative assessment

Details of re-assessment (where required by referral or deferral)

Re-assessment notes

Deferral – if you have been deferred for any assessment you will be expected to submit the relevant assessment. The mark given for a re-assessment taken as a result of deferral will not be capped and will be treated as it would be if it were your first attempt at the assessment. 

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Referral – if you have failed the module overall (i.e. a final overall module mark of less than 40%) you will be expected to submit the relevant assessment. The mark given for a re-assessment taken as a result of referral will be capped at 40% 

Indicative learning resources - Basic reading

Recommended Text:

• Madura, J. (2021). Financial markets and institutions. Cengage.
• Mishkin, F. S. (2018). Financial markets and institutions. Pearson Higher Education.
• Mishkin, F.S. (2022). Economics of Money, Banking and Financial Markets: Global Edition. 13th edition. Pearson Higher Education.

ELE – Web-based and electronic resources will be posted and made available throughout the module 

Key words search

Financial Markets, Financial Instruments, Bank and Non-Bank Institutions, risk and regulation, global markets