CORPORATE FINANCE
MOD. 1. CORPORATE BANKING (Prof. C. Schena)
There are no explicit prerequisites. A good understanding of basic Principles of “Economics of Financial Intermediaries” is however recommended.
The students who have already had “Corporate Banking” (or similar exams) during their Undergraduate degree, have to refer to the program “Corporate
banking – Advanced course”.
MOD. 2. COPORATE FINANCE (Prof. A. Uselli)
There are no explicit prerequisites. A good understanding of basic Principles of Corporate Finance, Accounting and Financial Statements and Financial Mathematics is however recommended.
MOD. 1 CORPORATE BANKING (Prof. C. Schena)
BASIC COURSE:
The course aims at providing students with a broad overview of sources of funding for companies. The topics are analyzed in the economic perspective of the entrepreneurs, above all to highlight the available solutions for small and medium enterprises (SMEs). The course focuses on the following aspects and instruments to solve financial problems of the enterprise: credit contracts and banking services; financial advisory services; corporate and investment banking; institutional investor activity in risk capital (venture capital and private equity); structured finance. The final section of the course examines the solutions supplied by banks to distressed firms.
At the end of the course the student will be able to know and understand the main economic and financial variables used to evaluate different type of funding, capital increase and efficient way of risk management.
Results should be analysed by the student in order to make a judgment related to the acceptability of financing decisions and their impact on company’s risk exposure.
ADVANCED COURSE:
This course aims at providing students with advanced competences in the area of financial management of the firm and of the corporate and investment banking activities. Special attention is given to the analysis of those topics which are relevant for the relationship between firms, financial intermediaries and consultants.
ASSESSMENT:
Final written test, which lasts an hour and a half, divided in 5 questions.
For the purpose of passing the exam is necessary to achieve a rating of at least 18 points over 30.
The student who achieves a grade lower than 15 out of 30 in the written test cannot sit for the next written test within the same exam session.
MOD. 2 CORPORATE FINANCE (Prof. A. Uselli)
The course covers a selection of the major advanced topics of corporate finance, focusing on some of the “pillars” of Corporate Finance:
a.the investment policy;
b.financing decision;
c.the dividend policy;
d.firm valuation.
We will examine the variables and the main algorithms to estimate the value of firms. We also focus on issues related to the complex choices of capital budgeting (real options and under uncertainty) and to the decisions on the composition of the firms’ financial structure and their impact on firms’ value.
At the end of the course the student will be able to know and understand the main economic and financial variables used to estimate the value of a company.
Results of estimations should be analysed by the student in order to make a judgment related to the acceptability or otherwise of an investment or financing decision. For example: whether or not to replace the firm’s car fleet, purchasing a new machine for the production chain, compare the cost of a debt issue and a share issue, to assess M&A operations.
MOD. 1. CORPORATE BANKING (Prof. C. Schena)
BASIC COURSE:
1.The role of the markets and the financial intermediaries in satisfying the financial needs of the various types of corporations.
2.Bank-firm relationship. Evolution and development perspectives in the evaluation criteria of the financial needs of a firm: internal rating systems and the development of corporate banking services.
3.The main financing sources of firms:
a)The credit channel: the short, medium and long term credit (brief overview); pool financing; leasing; subsidized credit; surety credit.
b)The role of CONFIDI for supporting SMEs.
c)The access to the market for financing through debt (mini-bond, bond, subordinated and hybrid instruments) and capital instruments (brief overview).
d)Listing of financial instruments on the Stock Exchange (brief overview).
4.Risk management and hedging:
a)Payment services and treasury management for the management of liquidity risk: home banking and cash management.
b)Derivatives and insurance services for the hedging of credit risk and market risk (hints).
c)The securitization of corporate credits: a way to get funds and externalize credit management.
5.Consulting and financial advisory services:
a)Financial information and consulting services.
b)Credit management services: factoring.
c)Counselling for transactions on the primary and secondary securities market.
6.Interventions on the risk capital and support in the structured finance operations:
a)Acquisitions of companies by banks; Italian banks and the market of acquisitions.
b)The role of closed funds.
c)Private equity and venture capital in Italy: an analysis of the main forms of intervention (start up financing, LBO and MBO).
d)Project finance.
7.The role of banks in the resolution of crisis of firms:
a)Bank credit restructuring.
b)Business recovery plan.
ADVANCED COURSE:
1.Italian economic situation and the position of companies.
2.The activities in the corporate banking: due diligence, evaluation and monitoring of operations.
3.Project finance and mezzanine finance instruments.
4.Securitisation.
5.The development of CONFIDI.
6.The functioning of “Centrale dei rischi” in the perspective of the bank, of the firm and of the consultant.
7.The crisis of the firm and the turnaround process.
MOD. 2. CORPORATE FINANCE (Prof. A. Uselli)
1. Review of the course content of Principles of Corporate Finance (undergraduate cours)
1.1 Basic elements of capital budgeting
1.2 The capital budgeting’s criteria
1.3 The evaluation of alternative projects
2. Advanced topics in capital budgeting
2.1 Sensitivity analysis
2.2 Break even point analysis
2.3 Scenario analysis and decision trees
3. Real options
3.1 Extended NPV
3.2 The valuation of real options
4. The firm’s capital structure
4.1 The propositions of Modigliani-Miller
4.2 The weighted average cost of capital
4.3 The effect of corporate taxes
4.4 The effects of the collapse, the agency conflicts and information asymmetries
5. The capital budgeting for levered firms
5.1 Investments’ valuation for levered firms
5.2 The debt’s tax shield
5.3 The debt’s capacity
5.3 How much should a firm borrow?
6. Special topics of corporate finance
6.1 The dividend policy
6.2 International corporate finance
6.3 The firm’s valuation
MOD. 1. CORPORATE BANKING (Prof. C. Schena)
BASIC COURSE:
1.AA.VV., La crescita delle PMI attraverso gli strumenti di finanza innovativa, FrancoAngeli Editore, Milano, 2014, capitoli 1, 2, 6, 7.
2.Banca d'Italia, Relazione annuale 2015, Roma maggio 2016, pp. da 66 a 72; da 129 a 132; da 137 a 145; 150; da 158 a 162. Il testo si può scaricare dal sito internet: http://www.bancaditalia.it/pubblicazioni/relazione-annuale/2015/rel_2015...
3.Forestieri G., Corporate e investment banking, Egea, Milano, 2015, capitoli 7 (solo paragrafo 7.1); 9 (esclusi i paragrafi 9.5 e 9.6); 10 (escluso il paragrafo 10.6); 14 (solo il paragrafo 14.1); 17.
4.Schena C., L’adeguatezza patrimoniale dei Confidi: profili normativi e prospettive gestionali, capitolo 3 in Locatelli R. (a cura di), Rischi, patrimonio e organizzazione nei Confidi, FrancoAngeli Editore, Milano, 2012.
No other teaching materials (handouts, summaries, etc.) are authorized by the teacher.
ADVANCED COURSE:
1.Forestieri G., Corporate e investment banking, Egea, Milano, 2015, capp. 5, 15, 16.
2.Locatelli R. (a cura di), Rischi, patrimonio e organizzazione nei Confidi, FrancoAngeli Editore, 2012.
3.Caselli S. - Gatti S. - Di Giuli A., Are Small Family Firms Financially Sophisticated?, Journal of Banking and Finance, Volume 35, Issue 11, November 2011.
4.AIBE (2012), Banche e operatori esteri in Italia, Capitolo 4.
5.Minnetti F. (2011), Corporate banking e finanza straordinaria d'impresa, Bancaria Editrice, capitolo 5.
6.Giorgiantonio C. - Giovanniello V. (2009), Infrastrutture e project financing in Italia: il ruolo (possibile) della regolamentazione, Occasional paper - Banca d'Italia, n. 56. Disponibile all'indirizzo http://www.bancaditalia.it/pubblicazioni/econo/quest_ecofin_2/QF_56/QEF_...
7.Albertazzi U. - Eramo G. - Gambacorta L. - Salleo C. (2011), Securitization is not that evil after all, BIS Working Papers No 341. Disponibile all'indirizzo http://www.bis.org/publ/work341.pdf
8.Lenoci F. - Peola S. (2011), Nuova Centrale dei Rischi, IPSOA: paragrafi 1.4 e 2.4; capitolo 3; paragrafi 5.1, 5.2, 6.2, 6.3, 7.1, 7.2, 7.3.
No other teaching materials (handouts, summaries, etc.) are authorized by the teacher.
MOD. 2. CORPORATE FINANCE (Prof. A. Uselli)
The course material required is as follows:
• For a review of basic capital budgeting is recommended: R.A. or Brealey, Myers S.C., Allen F. and S. Sandri, “Principles of Corporate Finance” [it], McGraw-Hill, Milan, 2015, 7th edition, chaps. 2, 5 and 6, or a similar handbook available at the Library of Economics.
• For all students: R.A. or Brealey, Myers S.C., Allen F. and S. Sandri, “Principles of Corporate Finance” [it], McGraw-Hill, Milan, 2015, 7th edition.
Required parts will be indicated in class and published with a notice on e-learning platform.
Other materials (slides of the lectures, tutorials and study materials) will be progressively available online on e-learning platform.
No other teaching materials (handouts, summaries, etc..) are authorized by the teacher.
Modules
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Credits: 6
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Credits: 6