This Master of Finance course provides students with tools to value companies and understand the work and services provided by the investment banking industry. Using a number of case studies written by the instructor, the course provides detailed coverage on capital raising, M&A, and corporate restructuring. It will also provide students with a specialized vocabulary and important facts about the investment banking industry. The course is delivered as a mixture of lectures, case studies, and guest speakers. The objective of the cases is to use the logic of financial theory to arrive at sensible conclusions when faced with real world problems.
This course offers a comprehensive coverage of the major areas of corporate finance such as capital structure decisions, long-term financing, corporate payout policy, restructuring, and hedging. The first part of the course examines the optimal capital structure. In particular, it examines in depth how corporate taxes and capital market imperfections affect the capital structure decisions. The standard corporate valuation approaches are introduced after students develop a deep understanding of the corporate leverage decisions. Next, the course will make an introduction to long-term capital raising such as IPO, SEO, and debt issuance, corporate payout policy, corporate governance, and financial distress. The last part of the course introduces vanilla derivative securities and how to apply an option pricing framework to value strategic options embedded in investment projects.
The main focus of the course is restructuring financially distressed firms. We begin by reviewing the financial instruments commonly used by risky firms (leveraged loans and high-yield bonds) and learn to interpret the contracts that govern them (credit agreements and bond indentures). We survey a variety of restructuring methods (exchange offers and out-of-court workouts, prepackaged and pre-negotiated bankruptcies, distressed asset sales, and Chapter 11 reorganizations) available to troubled firms, and study the dynamics of the restructuring process through a number of case studies. The course provides students with tools to value distressed companies, understand the legal framework governing bankruptcy and reorganization in the U.S. and other countries, and navigate the key strategic issues facing managers and investors in distressed companies. It will also provide students with a specialized vocabulary and important facts about the restructuring industry, distress investing, and leveraged financial markets.
Leveraged Financeand Debt Restructuring
The objective of this short-course is to familiarize executives in the financial and corporate sectors with the financial, legal, and strategic issues associated with the debt restructuring process in the U.S. The focus is on how to restructure financially distressed firms. We begin by reviewing the leveraged financing markets and then survey a variety of restructuring methods (exchange offers and out-of-court workouts, prepackaged bankruptcies, and Chapter 11 reorganizations) available to troubled firms, and study the dynamics of the restructuring process. We discuss a case study to further strengthen the understanding of key issues involved in restructuring. The session will provide students with tools to understand the legal framework governing bankruptcy and reorganization in the U.S., and navigate the key strategic issues facing managers, lenders, and investors in distressed companies around the world.
This course covers valuation techniques of the traditional fixed-income securities. It begins with basic concepts such as price-yield relationship and alternative definitions of yields and introduction to the types of fixed income securities. The next topics are related to spot rates, discount factors, forward rates, par-bond yields, holding period returns, and classical theories of term structure of interest rates, which lay down the foundation for understanding interest rate risk. Yield curve fitting techniques are then explained which are essential for estimating various interest rate curves needed for practical uses. Price sensitivity measures (durations and convexities) and simple portfolio strategies will be elaborated in details. The course then moves on to the topics on corporate bond and credit risk. An introduction to the structural and reduced-form credit risk models is provided. Finally, the course covers corporate restructuring and credit default swaps. Both economic intuition and quantitative skills are emphasized. This course is a required course for the master-of-science (financial analysis and investment management) program and an elective course MBA students with good quantitative skills, who are strongly interested in fixed-income securities.
Empirical Corporate Finance
This PhD level course covers major topics in empirical corporate finance. A large part of this course is devoted to examining research questions in capital structure, corporate governance, and corporate restructuring. The focus is on the more recent literature in these broad areas of corporate finance and important empirical methods that are commonly used corporate finance studies. The goal of the course is to familiarize the students with the most important areas of corporate finance and help students get ready to conduct their own research.