Reference no: EM13136700

SECTION A 
Question 1 

Today is 3 January 2014, your first day at a new job after graduating with your degree in Finance. You report to the Treasury Head of a large local corporate. Your new boss wants to place a bid for a particular 180-day T-bill that settles on 15 January 2014. He has asked you to work out the price the company should bid for a discount yield of 0.29% p.a. You are worried as you have totally forgotten the mathematical formula for T-bills. However, you remembered your FIN305e instructor telling you about the discount pricing function in Excel and you get to work. 

(a) Prepare to calculate the price using Excel and take one Excel print screen shot to demonstrate the inputs for calculation. 
(b) Calculate your answer above in per $100 of face value to the last 3 decimal. 
(c) You then remember that the financial markets have been very volatile lately. You decide that you want to impress your new boss by showing initiative on your first day of work. Examine other data that you think would be useful to your new boss by taking a screen shot of the data or by downloading the data. Write in a succinct 5 sentence note to your boss on the data you chose for his further consideration. 
(Word Limit: 200 words) 

Question 2 

A privately owned real-estate company is thinking of expanding. However, it is constrained by limited sources of capital. Its existing shareholders are very low-profile and have doubts about the merits of listing his company. You have been engaged as a financial consultant to this company. 

(a) Analyse the advantages and disadvantages of listing the real-estate company from the perspective of your client. Explain the IPO process in Singapore. 
(b) Examine the Sponsor-REIT model in Singapore and its potential suitability for your client using at least two actual examples. 
(c) Discuss and conclude with your recommendation. 
(Word Limit: 800 words) 

Question 3 

A significant share of China's international trade transactions are denominated in US dollars and changes in US dollars / renminbi exchange rate have enormous implications for the profitability and balance sheets of Chinese firms. Therefore, the Chinese government has essentially fixed the renminbi / dollar rate until July 2005 when the managed floating exchange rate regime was adopted. Thereafter, the renminbi gradually appreciated. 

(a) Examine the initial successes of the managed floating exchange rate regime in the China context. 
(b) Analyse the current difficulties and challenges faced by China regarding this tightly managed floating exchange rate regime. 
(Word Limit: 600 words) 

Question 4 

On 17th September 2008, many individual investors of a structured product called "DBS High Notes 5" received a late night phone call from their banker, DBS Bank, warning them that their investments in this product could be potentially wiped out due to the collapse of Lehman Brothers. One of your elderly relatives invested in this product and had trouble comprehending how his seemingly risk-free investment in "DBS High Notes 5" could be linked to the collapse of Lehman Brothers. 

(a) Explain to your relative, by analysing the structure and nature of the "DBS High Note 5" with a suitable diagram. 
(b) Examine the key risk triggers inherent in this structure. 
(c) With the benefit of hindsight, analyse and give your views on how this saga might or might not have been prevented. 
(Word Limit: 800 words) 

Question 5 

Below are four scandals in which traders have attracted infamy for their banks and for themselves. 


1997 Barings Bank Nick Leeson 
2008 Société Générale Jérôme Kerviel 
2011 UBS Kweku Adoboli 
2012 JP Morgan Bruno Iksil 

(a) Analyse the events leading to each scandal and examine similarities among the four. 
(b) Examine the consequences and lessons learnt from the four cases. Analyse the need and effectiveness of regulations and suggest and how might such lapses be prevented in the future. 
(Word Limit: 1000 words) 

SECTION B (Total 25 marks) 

Prepare a video recording of your response to Question 3. The presentation should be of at least 3 minutes but not exceeding 6 minutes. 

SECTION C (Total 10 marks) 

Prepare a set of Powerpoint slides upon which the video presentation is based.