EXC 3651 Shipping Finance

EXC 3651 Shipping Finance

Course code: 
EXC 3651
Department: 
Finance
Credits: 
7.5
Course coordinator: 
Siv Jønland Staubo
Course name in Norwegian: 
Shipping Finance
Product category: 
Bachelor
Portfolio: 
BBA - Specialisation in Shipping
Semester: 
2019 Spring
Active status: 
Active
Level of study: 
Bachelor
Teaching language: 
English
Course type: 
One semester
Introduction

The task of this course is to help understand the economics of the shipping indusrty. What makes it so interesting is the greate voatility in the industry and it is a perfect market for blending theory and practice. Because shipping is such an old indusrty, with a history of continous change, we have a unique oppertunity to learn from the past.
The essence of business administration includes corporate finance (i.e. investment and financing). Good knowledge within these areas is a necessary prerequisite to understand the economic content of investment and financing decisions. This is vital knowlegde for people working in the shipping industry. Further it is important to be able to obtain decision-relevant information, discuss and assess alternatives, make correct decisions and convey relevant and useful information.
The aim of this course in corporate finance in the shipping industry is to provide the students with essential knowledge and skills, so that they can take part in discussions on problems in finance and carry out simple analyses within the field, make correct decisions and communicate the results of the analyses in a comprehensible manner.
The course focuses mainly on capital structure in general, and capital sturcture in the shipping industry in particular.

Learning outcomes - Knowledge

After completed course, the students shall have learned:

  • Different financial theories
  • Capital structure decisions in different tax regimes.
  • Capital structure decisions and volatility, which is essential for the shipping industry.
  • How dividend decisions might affect firm value and firm.

 

Learning outcomes - Skills

After completed course, the students shall be able to:

  • Differentiate between the advantages and/or disadvantages of different financing instruments.
  • Explain key concepts and give an account of the tools used in analyses of corporate finance problems in general, and corporate finance problems in the shipping industry in particular.
  • Explain from the toolbox: valuation methods, cash flow effects of distribution policy.
  • Give written answers to questions so that the readers understand the applied methods and conclusions.
Learning Outcome - Reflection
  • After taking the course, the students shall be able to ask critical questions and reflect on crucial assumptions and theories within the field of corporate finance.
Course content

1. Cost, Revenue and Cash Flows in the Shipping Industry, ch. 6 (MS)
2. Project analysis, ch. 10 (BMA)
3. Investment, Strategy and Economic Rents, ch. 11 (BMA)
4. Risk, Return and Shipping Company Economics, ch. 8 (MS)
5. Efficient Markets and Behavioral Finance, ch. 13 (BMA)
6. An overview of Corporate Finance, ch. 14 (BMA)
7. How Corporations Issue Securities, ch. 15 (BMA)
8. Pay-out Policy, ch. 16 (BMA)
9. Does Deby Policy matter?, ch. 17&18 (BMA)
10. Financing Ships and Shipping Companies, ch. 7 (MS)
11. Financing and Valuation, ch. 19 (BMA)

Learning process and requirements to students

The course will include a combination of lectures and plenary tutorials where solutions to exercises will be explained. 

The students are responsible for obtaining any information provided in class that is not included on the course homepage/It's learning or the text book. 

Excel spreadsheet models are highly recommended for problem-solving. 

Software tools
No specified computer-based tools are required.
Additional information

Due to change in the exam elements, a re-sit examination in EXC 36511 will be offered autumn 2018 and spring 2019.

Qualifications

The specialisation requires two years of university education in Business Administration or equivalent.

Required prerequisite knowledge

EXC2110 Basic Financial Management

Assessments
Assessments
Exam category: 
Submission
Form of assessment: 
Written submission
Weight: 
100
Grouping: 
Group/Individual (1 - 4)
Duration: 
48 Hour(s)
Exam code: 
EXC 36512
Grading scale: 
ECTS
Resit: 
Examination every semester
Exam category: 
Submission
Form of assessment: 
Structured test
Invigilation
Grouping: 
Individual
Support materials: 
  • BI-approved exam calculator
  • Simple calculator
  • Bilingual dictionary
Duration: 
1 Hour(s)
Comment: 
Multiple choice.
Exam code: 
EXC 36513
Grading scale: 
Pass/fail
Resit: 
Examination every semester
Exam organisation: 
Ordinary examination
All exams must be passed to get a grade in this course.
Total weight: 
100
Student workload
ActivityDurationComment
Teaching
36 Hour(s)
Feedback activities and counselling
6 Hour(s)
Group work / Assignments
118 Hour(s)
Preparation for lectures and plenary tutorials and work on two voulentary hand-in assignments
Student's own work with learning resources
40 Hour(s)
Sum workload: 
200

A course of 1 ECTS credit corresponds to a workload of 26-30 hours. Therefore a course of 7,5 ECTS credit corresponds to a workload of at least 200 hours.