LLAW6312 & JDOC6312

General Course Information

1.1 Course details

Course code: LLAW6312 / JDOC6312
Course name: Legal and Regulatory Aspects of Financial Risk Management
Programme offered under: LLM Programme / JD Programme
Semester: Second
Prerequisites / Co-requisites: No
Credit point value: 9 credit / 6 credits
Cap on student numbers: 50

1.2 Course description

The course introduces students to the compliance aspects of risk and liquidity management in financial institutions and the tools used in the performance of the compliance function.

Financial institutions play a crucial role in the economy by providing liquidity and services which allow a higher level of economic activity than would otherwise be possible by taking or transforming risk. Consequently, risk and liquidity management lie at the heart of financial institutions’ business model. Uncontrolled risks may transcend and affect other institutions and the economy at large. How financial risk management is undertaken is explored from two compliance-driven perspectives.

Firstly, from an internal compliance perspective, which concerns the considerations and steps taken by financial institutions when entering into financial derivatives and subsequently managing the trade. This will consider the interactions between legal, compliance, onboarding, regulatory, operational, information technology and stakeholder considerations. Secondly, from an external perspective, which will consider how the compliance function performs its task in relation to different clients, counterparties and regulators who monitor, assess and seek to prevent excessive or concentrated risk-taking, or its transmission to other institutions potentially leading to default or insolvency.

In the process of examining the role of the compliance function in financial risk management, the course will cover required risk disclosures and legal and regulatory metrics, as well as information and data management. This will require a basic appreciation of the uses of complex financial instruments including derivatives, securities financing transactions, and margin loans, and techniques such as financial guarantees and (dynamic) margining.

1.3 Course teachers

Name E-mail address Office Consultation
Course convenor Christian Alexander Mecklenburg-Guzmán TBA N/A By email

Learning Outcomes

2.1 Course Learning Outcomes (CLOs) for this course

CLO 1 Develop necessary reasoning and problem-solving skills to discuss controversial issues relating to banking and financial regulation to independently find solutions to complex compliance problems.

CLO 2 Critical knowledge of the sources and evolution of international financial regulations.

CLO 3 Critical and analytical capacity to confront problems regarding financial risk management in an interdisciplinary way.

CLO 4 Appreciate and evaluate the role of compliance professionals and legal mechanisms in the management of financial risk and develop coherent and solid arguments to understand the law and the regulation in an inter-disciplinary context.

CLO 5 Expand critical thinking and autonomous learning skills, to enable students to gain knowledge in an area of considerable commercial interest which will enhance employability potential in the financial services and public authorities.

2.2 LLM and JD Programme Learning Outcomes (PLOs)

Please refer to the following link:

LLM – https://course.law.hku.hk/llm-plo/

JD – https://course.law.hku.hk/jd-plo/

2.3 Programme Learning Outcomes to be achieved in this course



3.1 Assessment Summary

Assessment task Due date Weighting Feedback method* Course learning outcomes
Class participation N/A 10% 3 2, 4, 5
In-class small groups coursework discussions TBC 10% 3, 5 1, 2, 3, 4, 5
Coursework presentation TBC 10% 3, 5 1, 2, 3, 4, 5
Take home exam^ TBC 70% 1, 3 1, 2, 3, 4, 5

^ Students are required to pass the exam to be eligible to pass the course.

*Feedback method (to be determined by course teacher)
1 A general course report to be disseminated through Moodle
2 Individual feedback to be disseminated by email / through Moodle
3 Individual review meeting upon appointment
4 Group review meeting
5 In-class verbal feedback

3.2 Assessment Detail

To be advised by course convenor(s).

3.3 Grading Criteria

Please refer to the following link: https://www.law.hku.hk/_files/law_programme_grade_descriptors.pdf

Learning Activities

4.1 Learning Activity Plan

Seminar: 3 hours / week for 12 teaching weeks
Private study time: 9.5 hours / week for 12 teaching weeks

Remarks: the normative student study load per credit unit is 25 ± 5 hours (ie. 150 ± 30 hours for a 6-credit course), which includes all learning activities and experiences within and outside of classroom, and any assessment task and examinations and associated preparations.

4.2 Details of Learning Activities

To be advised by course convenor(s).

Learning Resources

5.1 Resources

Reading materials: Reading materials are posted on Moodle
Core reading list: TBA
Recommended reading list: TBA

5.2 Links

Please refer to the following link: http://www.law.hku.hk/course/learning-resources/