Explain key banking concepts, such as liquidity and solvency, and their interrelationship by analyzing a bank’s balance sheet and income statements in the context of imperfect information.

What are the key features of the Bank Recovery and Resolution Directive (BRRD) introduced in the European Union in 2015? Does the introduction of bail-in mean the end of “too big to fail”?

• Explain key banking concepts, such as liquidity and solvency, and their interrelationship by analyzing a bank’s balance sheet and income statements in the context of imperfect information.

• Explain the importance and limitations of prudential regulation in preventing banking crises, including capital requirements and the Basle Accords (Basel I, II and III).

Understand the key differences between micro- prudential and macro-prudential regulation and the concept of systemic risk.