University of Santo Tomas

College of Commerce and Business Administration

Department of Financial Management
COURSE PLAN
MONETARY POLICY AND CENTRAL BANKING (FIN 105)

Course Facilitator: Ms. Nora Elena M. Castillo

Days/Time/Room: MWF: 12 noon 1 PM /Room 416, 2 PM 3 PM/Room 418
Yr/Sec : 4FM1, 4FM5

A. Course Description:
This course introduces the students to the fundamental concepts and principles of the monetary system, monetary
policy and the role and functions of the central banking systems of the Bangko Sentral ng Pilipinas (BSP), Federal Reserve
System and the European Central Bank. Topics include money creation and central banking: Instruments of monetary policy:
Operations of the monetary board: crosses, models and curves: monetary theories, policies ideas and results.

This course covers the system of public finance.

The course develops in the students an in-depth understanding of monetary concepts relevant to the finance function.

B. Course Intended Learning Outcomes:

The student should develop technical and analytical skills by applying different concepts, principles and processes of
monetary system and use these orientations to demonstrate critical thinking and problem solving skills and provide fair
judgment and sound financial decisions.
They should demonstrate an in-depth knowledge, analysis of the trends and issues and understanding of the different
paradigm shifts underlying the trends and issues in the Philippine Banking System, Federal Reserve System and the
European Central Bank, the banking industry on global perspective.
They should demonstrate social awareness and responsibility in analysing the effectiveness and relevance of public
finance and the different trends and problems underlying it.
They should engage in intensive individual study and work well with others in formal and informal cooperative and
collaborative learning teams.

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C. Course Outline:
D.
Week Topic
1-5 Unit I. BANKING AND THE PHILIPPINE FINANCIAL SYSTEM

A. Money and Banking (BSP, Federal Reserve, and Euro CB)

Concept and Functions of Money

Central Banking and Conduct of Monetary Policy
The CB and Monetary Creation Process
Monetary Policy Framework in the Philippines
Philippine Financial/Banking System
Financial innovations

B. CBP since 1993

From CBP to BSP

Restructuring of the old CB of the Philippines
Legal and Institutional Arrangements
The Monetary Board of BSP
Independence ND Accountability of BSP
Functions of the BSP

C. Other CBs

Federal Reserve System

Euro Central Bank
Review of the Different Central Bank Governors, the highlights of
performances during their term of office

D. Philippine Financial System

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 Week Topic
Role of PDIC
Role of BSP in the Financial System

Unit II. CENTRAL BANKING AND BANK SUPERVISION OF BSP

6-8 E. Supervision of Financial Institutions

Supervision and Examination Sector

i. Financial Institutions under BSP Supervision
ii. Risk-based supervision
iii. Consolidated Supervision

F. Currency Operations

Bank Issue
CB/BSP Currency Issue
Currency Production
Banknote Production Process
Cash Operations
Protecting the Integrity of the Currency
Role of Money in the Economy
Glimpse of the notes and coins issued by the CBP and BSP

PRELIMINARY EXAMINATIONS
Unit III. MONETARY POLICY

9 - 16 A. Monetary Policy: Brief Survey with Focus in the Philippines

How Monetary Policy Impacts on the Economy

Expectations and Lag in the Impact of Monetary Policy

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 Issues in the Design of a Money Policy Framework

B. Monetary Policy: Brief Survey with Focus in the Philippines

Project presentations: Various Monetary Tools and Policies

implemented by the Central Banks in the Philippines and abroad,
timeliness and effectiveness of the program

17-18 Unit IV. PUBLIC FINANCE

A. History of Public Finance

B. Implementing Public Finance

FINAL EXAMINATIONS

E. Basic Readings

Money & Banking in the Philippines, a BSP Publication

Manual of Regulations for Banks, a BSP Publication
Bank Management & Financial Services, 7th Edition, Peter S. Rose and Sylvia C. Hudgins
Money and Banking (M & B2), Dean Croushore

F. Extended Readings

Weekly Publication of Asian Wall Street Journal

Biblionet/webnet
http://www.bsp.gov.ph
http://www.federalreserve.gov
http://www.mart.com.ph
http://www.pdex.com.ph

G. Course Requirments:
FIN 101

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H. Grading System:
Preliminary Term
Class Standing ------------ 60%
Quizzes
Recitation
Case Analyses
Article Reviews
Prelim Exam ----------------- 40%

Final Term
Preliminary Grade --------- 50%
Class Standing ----------- 30%
Quizzes
Recitation
Case Analyses
Reports
Final Exam --------------- 20%

TOTAL = 100%
====

I. Classroom Policies:
1. Students are expected to attend class, participate in discussions, come to class prepared, and submit class assignments
on time. (Late assignments will only be accepted from students who have legitimate excuses).
2. Students should come early to class to avoid tardiness and absenteeism. Students coming to class 10 minutes after the
time shall be marked late and will be considered absent beyond 20 minutes.
3. Students should be responsible to find out what material was covered from other students during the class session that
the student missed due to some unforeseen circumstances.
4. Plagiarism, cheating and unethical behaviour in any form will not be tolerated in this course. Engaging in such behaviours
will result in a failing course grade. You are to do all of your own work. Plagiarism is defined as representing (and using)
another persons ideas, writings, and work as ones own.
5. Cell phones are to be turned off during class. Tell the professor if you have special circumstances regarding the necessity
of use during class.

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 6. Make sure that the classroom is clean every start and end of class.
7. No cursing and bullying.
8. Stringent compliance to the code of conduct and discipline under PPS No. 1027 (pp. 91-92) of the Student Handbook A.Y.
2013-14.
9. Students should wear their school uniform properly and neatly and their IDs.

Aside from what is prescribed in the student handbook, the following are the professors rules:
10. No make-up quizzes shall be given for missed quizzes, regardless of circumstances, unless extremely meritorious, to be
determined on a case-to-case basis, upon the sole discretion of the course facilitator. Per College Policy, students who
failed to take their preliminary and/or final examination(s) on the scheduled date(s) may be given make-up examinations.
The lesson coverage of said make-up examinations shall be the same as that of the regularly scheduled examination, but
the make-up examination questions are designed to be more difficult and challenging. All make-up examinations must be
taken no later than the prescribed deadline specified by the College.
11. All assignments, projects and other requirements must be submitted on the specified date provided by the course
facilitator. Late submission of course requirements shall merit a corresponding deduction in points. The course facilitator
reserves the right to determine the acceptability of reason(s) presented by the student.
12. Prayer before and after class must be conducted.
13. Student should seek permission from the professor before going out of the classroom.

J. Consultation Schedule:
Faculty Member Ms. Nora Elena M. Castillo
Email-address castillonem@yahoo.com
Consultation Hours MWF 3 4 PM
Venue Faculty Room, St. Raymund Building

Prepared by: Noted by:

NORA ELENA M.CASTILLO ASST. PROF. ANTHONY DC. ALTAREJOS

Chair
Financial Mangement Department

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