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Risk Management in Financial Contracts

Objectives

The objectives of the course are the following ones:

- Examine and analyse the main legal concepts and principles applicable to Risk Management of Financial Contracts;

- Get acquainted with both the theoritical and practical aspects of the subject.

>Present financial operations in the banking and capital markets

>Present different types of guarantees, that is instruments of risk management and mitigation (guarantees propriu sensu and quasi-security)

>Understand the structure and operation of a complex financial agreement

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General characterization

Code

33162

Credits

6

Responsible teacher

PEDRO SIZA VIEIRA

Hours

Weekly - 2

Total - 24

Teaching language

English

Prerequisites

Not Applicable

Bibliography

Joanna Benjamin, Financial Law, 2008

Roger McCormick, Legal Risk in the Financial Markets, Oxford University Press, 2018.

Robert C. Gericke - Corporate Governance and Risk Management in Financial Institutions, Springer International Publishing, 2018.

Francisco Javier Población García - Financial Risk Management: Identification, Measurement and Management, Palgrave Macmillan, 2017.

Weidong Tian (eds.) - Commercial Banking Risk Management: Regulation in the Wake of the Financial Crisis, Palgrave Macmillan US, 2017

Philip Wood, Law and Practice of International Finance (University Edition) 2012, Sweet & Maxwell; 

S. Valdez, Ph. Molyneux, An Introduction to Global Financial Markets, 6th ed., Palgrave-McMillan, 2010;

Colin Bamford, Principles of International Financial Law, Oxford University Press, 2011.

Teaching method

Classes will be taught in an interactive manner where students will be invited to actively engage in the classes. Oral teaching will be reinforced by additional materials such as power point slides which will be uploaded onto the online virtual learning environment. Practical exercises will also be designed in order to help students make a bridge between theory and practice.

Evaluation method

The evaluation method for this course will be a final written exam. In addition, students will also have the possibility to be evaluated on a continuous evaluation basis.

Subject matter

1§.    Introduction: Financial markets as risk transfer markets

 

2.§.   Raising Capital

 

I.       Bank loans and contractual guarantees

 

A.     Different transaction types

1.      (Simple) Bank loans

2.      Syndicated loans

 

B.      Traditional structure of a loan agreement

 

  1. The use of standardized documentation in international financial law (namely, relevance of the LMA)

 

  1. Common contractual provisions and risk management

(a)    Conditions precedent

(b)    Representations and warranties

(c)     Undertakings

(i)      Information Undertakings;

(ii)     Financial Undertakings;

(iii)    General Undertakings (pari passu; negative pledge; and cross default clauses)

 

 

II.     Capital Market

 

  1. Debt

2.      Securitization

 

3§.       Guarantees strictu sensu

 

1.         Bank guarantees

2.         Financial collateral arrangements (Dir. 2002/47)