INTRODUCTION  

The module deals with banking regulation and supervision, and the bank – customer relationship. The first part introduces banks as important economic and social institutions and their regulation in a domestic and global context. The second part focuses on some key services commonly provided by banks in the course of the bank customer relationship and analyses relevant legal issues such as contractual fairness, the bank’s duty of confidentiality, and the potential for transactional and advisory liability. The module adopts a dynamic approach that balances theoretical perspectives, legal policy and the principles contained in statutes, cases, and commercial custom. It does not assume any prior knowledge of banking practice, but it does expect that students will quickly develop a keen interest in financial institutions and markets.

OBJECTIVES

The objectives of this module are to:

• Introduce banks, banking law and the business of banking to the learners; 
• Equip learners with detailed knowledge about the institutions involved in banking regulation     and supervision;
• Introduce the key banking transactions and their legal implications to the learners;
• Enable learners to appreciate the political, social and economic forces underlying the dynamism and evolution of the financial industry and attempts to regulate the resulting processes and supervise the relevant institutions; and
• Equip learners with the analytical tools for analysing domestic banking transactions and applying the relevant law to scenarios drawn from real-life situations.

LEARNING OUTCOMES

At the end of this module you should be able to:

• Demonstrate an in-depth understanding of the nature and legal status of the banker-customer relationship;
• Demonstrate detailed knowledge of the operation of customer accounts and the scope of the bank’s duties to customers;
• Demonstrate detailed knowledge of banking operations, including the provision of credit, the taking and enforcement of security for loans;
• Analyse and critically evaluate the relationship between the law and banking business as well as the practical application of the law to banking;
• Recognise and evaluate the issues related to the provision of banking services and regulation of the banking industry.

UNIT 1 – BACKROUND TO BANKING LAW

UNIT 2 – SOUND BANKING SYSTEMS

UNIT 3 – INTERNATIONAL AND COMPARATIVE PERSPECTIVES

UNIT 4 – IDENTIFYING SOME SOURCES OF BANKING SYSTEM PROBLEMS

UNIT 5 – BANKING SUPERVISION IN ZAMBIA

UNIT 6 – RELATIONSHIP OF BANKER AND CUSTOMER

UNIT 7 – CORPORATE GOVERNANCE

 

RECOMMENDED READING

Arora A, (2014) Banking Law. Liverpool: Pearson

Ellinger EP et al, (5th ed, Oxford University Press, 2011) Ellinger’s Modern Banking Law. Oxford University Press

Hapgood M, (13^th edn, LexisNexis Butterworths, 2007) Paget’s Law of Banking. LexisNexis: Butterworths.

Mwenda, K.K., (2000), Banking Supervision and systemic Bank Restructuring, USA: Cavendish publishing

ACTS OF PARLIAMENT

Banking and Financial Services Act, Chapter 387 of the Laws of Zambia

Bank of Zambia Act, No. 43 of 1996