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The financial service industry plays a significant role in the economy and it continues to undergo dramatic changes. Financial institutions (FIs) perform the essential function of channeling funds from savers to users of funds. Financial intermediation is subject to a significant risk as the recent financial crisis vividly illustrated. The risk management of FIs is crucial not only in maximizing shareholders’ value, but also in ensuring the stability of the whole financial system. In this course, students will acquire a working knowledge of (a) the function of financial intermediaries in the economy, and how this role has changed in the United States; (b) the sources of risks banks are exposed to (e.g., interest rate risk, market risk, credit risk, liquidity risk, sovereign risk) and how they manage them, and (c) elements of capital regulation.