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Microsoft Word - instructions MID SEMESTER ASSIGNMENT.docx AFIN8003 MID SEMESTER ASSIGNMENT (25%) TOPIC and RESOURCES Instructions: Write a 1500-word (+/- 10%) report in your own words, answering the...

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Microsoft Word - instructions MID SEMESTER ASSIGNMENT.docx
AFIN8003
MID SEMESTER ASSIGNMENT (25%)
TOPIC and RESOURCES

Instructions: Write a 1500-word (+/- 10%) report in your own words, answering the
Question below, along with the additional Bonus aspect (see below) using footnotes.
You should use a few appropriate section headings. Include a (
ief) Introduction and
Conclusion. Only the references listed below are permitted; reference them
iefly in
ackets during the text of your analysis using simply the autho
journal/date (eg Smith,
Investor magazine, April 2020); provide a full list of references used, at the end of your
paper. Footnotes must be numbered and displayed page-by-page as they occur (not in a
single list at the end of your essay). Footnotes and bibliography are additional to the
core 1500 word requirement. Your assignment must be typed and submitted in PDF
online via iLearn, where it will be checked by Turnitin for similarity: plagiarism may result
in penalty deductions or failure of the assessment. Allow time to format, check, PDF and
upload your report before the deadline. The report is due no later than Friday 11
September 17:00 (Sydney time). Late submissions will score zero.

Main Question: Corona crisis and banks (20 marks)
How is the 2020 COVID crisis affecting banks and bank regulation in advanced industrial
countries (including Australia)?

References:
https:
www2.deloitte.com/us/en/insights/economy/covid-19
anking-and-capital-markets-impact-
covid-19.html

https:
www.spglobal.com/marketintelligence/en/news-insights/latest-news-headlines/fitch-
downgrades-australia-s-4-biggest-banks-on-covid-19-impact XXXXXXXXXX

https:
thewest.com.au
usiness/economy/global-financial-crisis-shake-up-of-banks-will-get-us-
through-covid-19-says-reserve-bank-of-australia-ng-b881515175z

https:
www.smh.com.au
usiness
anking-and-finance/new-normal-life-for-australia-s-banks-
after-the-pandemic-won-t-be-pleasant XXXXXXXXXXp54px3.html
https:
www.abc.net.au/news/ XXXXXXXXXX/are-australian-banks-safe-amid-the-shock-of-
coronavirus/ XXXXXXXXXX

https:
www.itnews.com.au/news
anks-sacrificed-cdr-efforts-to-prevent-covid-19-cyber-threats-547396

https:
www.
a.gov.au/speeches/2020/sp-gov XXXXXXXXXXhtml

https:
uk.reuters.com/article/us-health-coronavirus-
itain-regulation
ank-of-england-cancels-
stress-test-of-banks-over-coronavirus-idUKKBN2170QI

https:
www.cnbc.com/2020/04/27/deutsche-bank-warns-on-coronavirus-impact-as-its-profit-falls-
from-a-year-ago.html

https:
www.bankingsupervision.europa.eu/press/p
date/2020/html/ssm.pr200312~43351ac3ac.en.html

https:
www.bankofcanada.ca/2020/05
idge-recovery-banks-covid-19-pandemic-response/

https:
www.
ookings.edu
esearch/fed-response-to-covid19/

https:
edition.cnn.com/2020/04/17
usiness
ank-earnings-defaults-recession/index.html

https:
www.federalreserve.gov/newsevents/pressreleases
creg20200401a.htm

https:
www.reuters.com/article/us-health-coronavirus-banks-bis-idUSKCN21X1B6

https:
voxeu.org/article/stress-tests-banks-liquidity-insurers-time-covid

https:
www.bis.org/publ
isbull11.htm

https:
www.bis.org/fsi/fsi
iefs2.htm

https:
www.bis.org/press/p200403.htm

https:
www.dw.com/en/coronavirus-shock-vs-global-financial-crisis-the-worse-economic-
disaste
a XXXXXXXXXX

https:
www.investmentweek.co.uk/opinion/4012753/coronavirus-crisis XXXXXXXXXX

https:
www.morgans.com.au/Blog/2020/March/Equity-Strategy-Why-COVID-19-isnt-a-GFC

Bonus points for making connections with lectures XXXXXXXXXXmarks)
5 bonus marks are available – during the course of your answer to the Main Question - for
insightfully identifying connections to concepts/measures/issues in AFIN8003 lectures
weeks 1-6. Cite the location in lectures (eg .’week 4, slide 7’). Use footnotes ONLY to
establish these connections between your assignment and concepts from AFIN8003
lectures. These footnotes are additional to the 1500-word essay length. Be sure to display
footnotes at the foot of the essay page where they are referenced (not as a single list at
the end of the report).

TOTAL MARKS AVAILABLE: 25
DUE BY: 5pm (17:00 Sydney time) Friday 11 September 2020

Microsoft Word - marking guide Major Assignment.docx
XXXXXXXXXXAFIN8003 BANKING AND FINANCIAL INTERMEDIATION
Major Assignment: marking guide



Criteria Very weak Weak Adequate Good Excellent
Relevance Failure to
understand the
question,
extensive
i
elevance
Failure to
address
important
aspects of the
question
Adequate
answer to the
question,
covers main
aspects
Thorough
answer
covering most
aspects of the
question
Comprehensive
and effective
answer to the
question
Knowledge and
understanding
Major e
ors,
little
knowledge or
eading
Limited
knowledge with
serious e
ors
or omissions
Adequate
knowledge and
understanding,
e
ors balanced
y sound work
Conceptually
sound, wide-
anging
knowledge and
understanding
Knowledge
ased on
independent
eading and
high-level
synthesis
Critical,
analytical and
integrative
thinking
No evidence of
critical or
analytical
abilities
Little evidence
of critical or
analytical
abilities
Sound
argument with
evidence of
analysis and
easoning,
more
description than
analysis
Flair and
originality of
thought,
effective
criticism of
other
arguments
Penetrating
analysis,
persuasive and
original
criticism of
others
Evidence of the
use of
appropriate
materials
Very little
evidence of
having read
elevant
material
Little use of
evidence,
limited reading,
eferences of an
inadequate
standard
Some use of
evidence, fair
amount of
eading, over-
eliance on one
or two
authorities
Good use of
evidence, wide
eading,
generally well
digested
Excellent use
and evaluation
of evidence
Structure and
presentation
Many faults in
logic and
structure of
eport, ideas
expressed
incoherently
Weak structure
and argument,
poor style and
presentation
Generally
coherent
structure,
generally clear
writing and
acceptable style
Well organised
structure, clear
writing and
accurate
English style
Excellent
structure, every
paragraph
counts, English
style shows
flair and
eloquence
Answered Same Day Sep 10, 2021 AFIN8003

Solution

Sumit answered on Sep 10 2021
166 Votes
Introduction: The COVID-19 was declared a Global pandemic by the World Health Organization on the 11th March, 2020, since then the COVID-19 has impacted the financials of each and every person in the world, be it any Individual, Organization or any Banking Institution. At the start of the COVID-19 many people compared it to the financial crisis of 2008 and 2009 (25 years Investment Week, March 2020). The financial crisis of the 2008 was due to the fall of the housing market in The United States of America but the COVID-19 has not only affected the financials around the world, the virus has restricted movement and travelling around the world due to which the demand is at all time low. Hence the effects of the COVID-19 are more like the crisis in 1919 and might have a long-term effect and not a V shaped recovery. Decreased productivity and lockdowns have already started to take a toll on the financials of the corporate sector. Supply chain disruptions, manufacturing hindrances and crippled health systems need a hefty public fund/stimulus to continue operations smoothly. Income from tourism, entertainment sectors among many others has already crippled the economic situation. Factors like these are all adding up to strain the global economy which might also have its repercussions in the year ahead.
Body: The Banks are affected by the virus heavily due to the reduced demand in the market, the demand for new loans from the banks has reduced (Deloitte, March 2020). The major reason for this is the lockdown and the decreased productivity which has impacted the financials of the company. Due to COVID-19, the demand in several factors has been affected badly and many companies has either reduced the productivity or has stopped their operations and productivity all together. The major industries which has been affected is the Tourism and the Entertainment sector which has taken the major toll and the demand from these sectors has been reduced to zero. This has impacted the profitability of the banks, since the main source of profit for the banks is to earn money through interest earned on loans provided by the banks. The Central banks around the world has responded to this risk by reducing the interest rate in the countries so that the demand can be raised and the banks can issue more loans and earn interest from the loans.
The next major risk being faced by the company is high risk of default (Deloitte, March 2020) that the banks will face due to the COVID-19 out
eak. The default refers to the non-payment of installment amount due to the bank. Since the major portion of loans are taken by the corporates and the salaried class and both of which are facing tough times due to the COVID-19 in either loss of business or loss of job, the banks around the world are facing the risk that the bo
owers will not be able to pay the installment...
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