ACADEMIC AFFAIRS COUNCIL ******************************************************************************

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1 ACADEMIC AFFAIRS COUNCIL AGENDA ITEM: 4.A.1 DATE: February 23, 2012 ****************************************************************************** SUBJECT: New Program NSU, MS in Banking & Financial Services Nthern State University has submitted a proposal f a Master of Science in Banking and Financial Services. The program would provide professional development people in the banking industry. The Board approved an intent to plan at the 2011 March/April meeting. NSU requests authization to deliver the degree by distance technology. The University does not request new state resources new student fees to fund the program. Funding will come from self-suppt tuition and redirection of existing resources. The proposed program suppts the system strategic goals (Policy 1:21). Expand graduate education Wkfce development by offering online programs NSU has authity f Banking & Financial Services certificates, a min, an associate degree, and bachel s degree maj. BHSU, DSU, and USD offer Master of Business Administration degrees. Nthern will have an opptunity to revise the proposal after the external review. ****************************************************************************** RECOMMENDED ACTION Provide comments to Paul Gough f the COPS and BOR coversheets.

2 South Dakota Board of Regents New Graduate Degree Program University: Nthern State University Proposed Graduate Program: Banking and Financial Services Degree: Master of Science Existing New Degree(s): Existing Intended Date of Implementation (term): Fall 2012 Proposed CIP code: University Department School of Business University Division School of Business: Department of Economics, Finance, and Banking University Approval To the Board and the Executive Direct: I certify that I have read this proposal, that I believe it to be accurate, and that it has been evaluated and approved as provided by university policy. President of the University Date After approval by the President, a signed copy of the proposal should be transmitted to the Executive Direct. Only after Executive Direct review should the proposal be posted on the university web site and the Board staff and the other universities notified of the URL. 1. What are the purposes of the proposed program? Nthern State University (NSU) requests approval f a Master of Science in Banking and Financial Services. The degree would expand NSU s curriculum to better meet the wkfce needs of the banking and financial services industry in South Dakota and the surrounding states. The degree will increase opptunities f students who are interested in careers in banking and financial services. U.S. Senat Tim Johnson, in a recent article 1, stated South Dakota is ftunate to have excellent public colleges. Not only do our universities provide students with a well-rounded education, they also help drive our economy f years to come by providing our local businesses with highly trained employees. Nthern State University (NSU) in Aberdeen is no exception, which is why I created a partnership between its Banking and Financial Services Program and the Senate Banking Committee when I became Chairman at the beginning of the 112 th Congress. Senat Johnson went on to say, In South Dakota, the financial services industry is vital to the state s economy. Me than 28,000 private sect jobs are fueled by this sect. 1 Source: Senat Tim Johnson, (2012, January/February issue). Nthern State, Banking Committee Partner to Help Students Prepare f Careers. Progress Magazine, p AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 2 of 22 Printed:

3 Similarly, the South Dakota Division of Banking 2 stated that In the last ten years, the total assets of South Dakota state chartered banks that the South Dakota Division of Banking regulates have me than doubled. We see both a demand and need f quality educated personnel to manage and service the growing asset base of our state chartered banks. In 2010, 28,708 people were employed in financial activities positions in South Dakota in 2010, making up 7.1% of South Dakota s total employment 3. The table below provides additional data on the banking industry in South Dakota. Table 1 State Banking Perfmance Summary State Charter Commercial Banks South Dakota (dollar figures in Sept. 30, 2011 Sept. 30, 2001 Dec. 31, 1994 millions) Total Assets 18,470 8,702 5,585 Source: Call Rept and Thrift Financial Rept, prepared by the FDIC-Division of Insurance and Research The University requests authization to deliver the program in an online fmat (self-suppt), supplemented by a capstone course delivered in a hybrid mode. Online delivery would allow bankers across the state to earn a degree without commuting relocating to Aberdeen. The University does not request new state resources new facilities to suppt the program. The program would be suppted with self-suppt tuition and redirection of existing resources. The proposed program suppts the Board of Regents strategic goals (Policy 1:21): Economic Development & Quality of Life: Contributes to wkfce development & quality of life by expanding academic programs to meet our future wkfce needs, offering offcampus and online programs A Master of Science in Banking and Financial Services will prepare students f the intense competition they will be facing upon graduation and will provide current banking and financial services professionals the skills required f advancement. Roger Stromberg, with the Conference of State Bank Superviss, agrees: The financial crisis and the resulting great recession have reminded us that fundamentals in banking matter. We must build an industry which is led by bankers who understand how to manage risk through the economic cycle. We welcome your wk in this area. 4 Expected Wkfce Demand in South Dakota Accding to the Lab Market Infmation Center at the South Dakota Department of Lab and Regulation, the employment projections f banking and financial services occupations in South 2 Source: Deputy Direct John Crompton and Direct Bret Afdahl, South Dakota Division of Banking, Exchange, January 13, Source: Bureau of Lab Statistics (Haver Analytics) created 3/24/ :05:48 AM 4 Source: Roger Stromberg, Conference of State Bank Superviss, Personal Communication, September 9, AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 3 of 22 Printed:

4 Dakota are predicted to increase by the year 2018 (see Table 2). Many of these occupations do not require a graduate degree. The advantage that the master s degree in Banking and Financial Services will provide is increased opptunities f employees to advance in their careers and move into positions of higher authity and responsibility. Table 2 South Dakota Employment Estimates and Projections, Banking and Financial Suppt Services Occupations, Projected Number of Average Annual Demand f Wkers SOC* Code Occupational Title 2008 Base Number of Jobs Jobs Actual Change Percent Change Financial Managers % , % Compliance Officers, except Ag, Construction, Health & Safety, Transptation Budget Analysts % Credit Analysts % Financial Analysts % Personal Financial Adviss % Insurance Underwriters % Financial Examiners % Securities, Commodities & % 26 Financial Serv. Sales Agents *Standard Occupational Classification, U.S. Bureau of Lab Statistics: Source: Lab Market Infmation Center, SD Department of Lab and Regulation, November 2010: accessed December 27, Nthern examined programs offered by other universities to determine whether graduates have obtained positions: Michigan State University offers a Finance MBA with a specialization in banking and financial institutions. Just over 100 students enroll in their full-time MBA programs each fall. Last fall, as a result of the recession, their placement rate dropped to 74%. Accding to Betsey Vohees, Associate Direct MBA Career Services at Michigan State University in FY11, As f employment rates, our final employment rate f the full time program last year was 74%. In a typical economy we range around 90-95%. The average annual salary in the area of finance is $91,701, although average salary f graduates with the specialization in banking and financial institutions was not available. 5 Dr. James Bexley, Smith-Hutson Endowed Chair of Banking at Sam Houston University, stated that many prospective students are drawn to the specialization of the banking degree as well as the institutions and agencies who hire those graduates. To that end, Sam Houston University has a 95% placement rate f their undergraduate and master s degree graduates. 6 5 Source: accessed September 24, 2010; Betsey Vohees, Personal Communication, February 25, 2010; and accessed September 24, Source: Dr. James Bexley, Smith-Hutson Endowed Chair of Banking at Sam Houston University, Personal Communication, September 9, AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 4 of 22 Printed:

5 Suffolk University (Massachusetts) offers a Master of Science in Financial Services and Banking (MSFSB). Me than 94% of recent graduates are employed continuing their education. The annual enrollment of all graduate programs is 1,200 students. 7 University of Glasgow (Scotland) offers a Master of Science in Banking and Financial Services. Glasgow has a rate of 96% f postgraduates that are either employed continuing their education. 8 The proposed program also responds to concerns identified by bankers in Nth Dakota and South Dakota, who have indicated that a number of banking executives will be retiring over the next few years, and the need f qualified individuals to fill those vacancies. Timothy Karsky, fmer Direct of the Nth Dakota Division of Banking, stated, There are many Nth Dakota institutions that will be filling voids in their management team, and I am very optimistic with this program that it will aid these institutions in fulfilling these positions. 9 Similarly, Roger Novotny, fmer Direct of the South Dakota Division of Banking, stated, The need f advanced degree graduates will also always be present in the private sect simply because of the continuing need f future leaders in the industry that will be caused by the changing age demographics in the financial services sect. 10 Mr. Novotny also stated that when opptunities decrease in one area of banking, they increase in another, such as regulation and compliance, which is a critical area in today s economy. Evidence of Student Demand f the Program The Gramm-Leach-Bliley Act of 1999 permitted affiliations among financial services companies, including banks, securities firms, and insurance companies. 11 The changing marketplace that resulted from the Act has created job opptunities f professionals with very different academic needs. 12 Kim Bowman, a Banking & Financial Services graduate who served as a bank Internal Audit after completing her degree and is now the Benefits Administrat at an area bank, agrees. The Masters in Banking and Financial Services at Nthern State University will allow me, along with others like me, to continue in my current career while pursuing this masters program in der to expand my knowledge in this fast-changing industry. 13 Timothy Karsky, Nth Dakota s fmer Banking Commissioner, feels the degree would provide opptunities f recent graduates: As a regulat f over 30 years, I believe the key to any success in any financial institution is the quality and education of the management team. Not only will this program benefit recent graduates that want to expand their level of expertise in 7 Source: and accessed September 23, Source: accessed September 24, Source: Timothy Karsky, fmer Direct, South Dakota Division of Banking, Personal Communication, August 24, Source: Roger Novotny, fmer Direct, South Dakota Division of Banking, Personal Communication, October 12, Source: accessed January 21, Source: accessed December 23, Source: Kim Bowman, NSU graduate and bank employee, Personal Communication, August 3, AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 5 of 22 Printed:

6 banking and financial services, but will also provide an opptunity to enhance the educational development of the individuals already in the banking industry. 14 Jared Vilhauer, a recent Banking & Financial Services graduate employed by the South Dakota Division of Banking, feels that the undergraduate banking program at NSU provides a solid foundation, but a masters degree presents the opptunity to provide graduates with the tools to make an immediate impact upon graduation and due to the diverse range risks, an undergraduate degree program without specialization struggles to provide graduates with a strong enough understanding of risk mitigation tools and strategies to make an immediate impact. F those students who aspire to have a career in banking, specifically bank management, it will be vital to provide the option of a master s degree that instills in them the principles necessary to operate in today s banking environment. 15 Rod Fouberg, Chairman of the Board of Directs f Dacotah Bank, stated that Dacotah Bank has benefited from its relationship with Nthern State University and the Banking and Financial Services degree 16 : The opptunity to wk with and provide internships to baccalaureate students has provided our company with well-prepared full-time employees. Following on the success of the baccalaureate program, we look fward to interacting with Nthern State University as the master s degree develops. We envision opptunities to wk with NSU graduate students and faculty as we study and implement the changes needed to effectively compete in our industry. There may be occasions where the perfmance and value of selected Dacotah Bank employees will be enhanced by a master s degree participation in concentrated summer wkshops. If we find that to be the case, we will consider participating in the employee s tuition fees. I believe that once value is shown, other ganizations in the industry will be willing to assist their employees with tuition costs, as well. Relationship to University Mission The statuty mission of Nthern State University is provided in SDCL : 17 The primary purpose of Nthern State University, at Aberdeen in Brown County, and Black Hills State University, at Spearfish in Lawrence County, is the preparation of elementary and secondary teachers, and a secondary purpose is to offer preprofessional, one-year and two-year terminal and juni college programs. Four-year degrees other than in education and graduate wk may be authized by the Board of Regents. 14 Source: Timothy Karsky, fmer Nth Dakota Banking Commissioner, Personal Communication, August 24, Source: Jared Vilhauer, NSU Graduate and SD Division of Banking employee, Personal Communication, April 6, Source: Rod Fouberg, Chairman of Board f Dacotah Bank, Personal Communication, December 7, Source: accessed October 18, AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 6 of 22 Printed:

7 Board Policy 1:10:6 Nthern State University Mission Statement provides degrees authized: 18 A. Undergraduate Programs Associate degree programs in arts and sciences, business, education, and fine arts. Baccalaureate degree programs in arts and sciences, business, education, and fine arts. B. Graduate Programs Masters degrees in education and E-learning. The University offers four graduate degrees: M.S.Ed. in Education, three emphases available M.S.Ed. in Teaching and Learning, four emphases available M.S. in E-learning (approved 2002) M.S.Ed. in E-learning (approved 2002) The Board has approved undergraduate banking and financial services programs: B.S. in Banking and Financial Services, 2005 December, Minutes, pp & The Board authized NSU to offer the maj in Sioux Falls and by distance delivery. A.S. in Banking and Financial Services, 2008 June, Minutes, pp & The Board authized delivery to Sioux Falls, Pierre, Rapid City, and online. Min in Banking and Financial Services, 2008 June, Minutes, pp & The Board authized delivery to Sioux Falls, Pierre, Rapid City, and online. Intermediate Banking Certificate, 2008 October, Minutes, pp & The Board authized delivery to University Center in Rapid City, 2009 December, Minutes, pp & Executive Banking Certificate, 2008 October, Minutes, pp & The Board authized delivery to University Center in Rapid City, 2009 December, Minutes, pp & Nthern State University has a long histy of producing graduates in its undergraduate business programs. The table below provides the baccalaureate majs in degrees conferred from FY06 to FY10. The proposed Masters degree is open to all business graduates. Those applicants that have earned an undergraduate degree in a field other than business will be required to complete certain undergraduate courses from the business ce comparable graduate-level foundation courses in business, pri to entering the program. 18 Source: accessed October 18, AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 7 of 22 Printed:

8 Table 3 Business and Accounting Majs Completed, FY07-FY11 Maj FY07 FY08 FY09 FY10 FY11 5-Years Business Business Administration Management Accounting Professional Accountancy Finance Banking & Financial Services International Business Administrative Systems Management Infmation Systems Marketing Degrees conferred by the University. Rept generated by Regents Infmation Systems, 2011 September 1. University Strategic Plan and Priity Nthern State University s strategic plan is titled 2010 Strategic Planning: Mission Fward. The plan was developed as a collabative efft among the University s faculty, staff, and administration. Priity 1 of the strategic plan is to: Recruit, retain, challenge, and graduate citizens with the highest capacity to enrich their communities through their professional lives and civic engagement. The Master of Science in Banking and Financial Services is a high priity f Nthern because it would suppt the following objectives of Priity 1: Grow graduate student enrollment by 50%. Double the number of course offerings delivered in online, alternate schedule, and wkshop fmat. 2. Rationale A. If a new degree is proposed, what is the rationale? The Master of Science degree is not new. Nthern State University offers an M.S. in E-Learning Technology and Administration. B. What is the rationale f the curriculum? Nthern wked with professionals in the financial services industry to develop a curriculum that meets the needs of the financial services sect, which will, in turn, provide students with the education and skills needed by top-level executives in the banking and financial services industry. The curriculum includes a ce set of courses that will provide the foundation f two areas of specialization: 1) International Banking and 2) Commercial Banking AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 8 of 22 Printed:

9 In der to be admitted into the program, a student must have either 1) an undergraduate degree in a business field 2) an undergraduate degree in a non-business area and successful completion of foundation courses in each of the following areas: Accounting, Finance, Business Statistics, Management/Marketing, Economics, and Business Law. C. Demonstrate that the curriculum is consistent with current national standards. Complete the tables below and explain any unusual aspects of the proposed curriculum. Very few graduate programs are available in Banking and Financial Services. NSU has examined programs at Sam Houston State University in Texas and Boston University in developing its curriculum. The degree programs offered at these institutions are similar to the one being proposed at NSU, although the proposed program is designed to prepare students f a wider variety of positions in the banking and financial services industry, and therefe offers two areas of specialization. Nthern State University consulted with people from the financial sect as the program was developed. With the rapidly changing requirements in the financial services industry, their feedback has been invaluable to NSU during the development of the proposed curriculum. A comparison between the proposed curriculum and the Boston University curriculum and Sam Houston State University curriculum is provided below AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 9 of 22 Printed:

10 Comparative of Nthern State University Proposed Banking and Financial Services Curriculum and those of Boston University and Sam Houston State University Ce Requirements Nthern State University 27 credit hours 1. Accounting f Banking 2. Banking & Financial Markets 3. Communications & Team Dynamics 4. Wealth Management & Planning 5. Marketing of Financial Services 6. Regulation and Compliance 7. Applied Econometrics 8. Enterprise Risk Management 9. Capstone: Strategic Management Boston University 24 credit hours 1. Cpate Finance 2. Project Management 3. Introduction to Electronic Commerce, Systems, & Web Design 4. International Business, Economics, & Cultures 5. Quantitative & Qualitative Decision Making 6. The Innovation Process: Developing New Products & Services Sam Houston State University 36 credit hours Year 1 (18 Credits) 1. Research Writing in Business 2. Techniques of Statistical Analysis 3. Seminar in Commercial Banking 4. Problems in Administrative Finance 5. Accounting f Management 6. Financial Statement & Credit Analysis Year 2 (18 Credits) 7. Selected Topics in Money, Capital, & Security Markets 8. Services Management & Marketing 9. Seminar in Marketing f Financial Institutions 10. Commercial Bank Lending 11. Seminar in Managerial Economics 12. Project Management Area of Specialization: International Banking Nthern State University (9 credits) Boston University Sam Houston State University 1. Cultures & Communication 2. International Economic They 3. International Banking Area of Specialization: Commercial Banking Nthern State University (9 credits) Boston University Sam Houston State University 1. Examination Process 2. Asset & Liability Management 3. Lending Students without an undergraduate degree in business will be required to complete foundation courses in der to acquire the knowledge needed to succeed in a business master s program. The next table compares the foundation requirements f the proposed program with the foundation courses required f the Dakota State University (DSU) and University of South Dakota (USD) Master of Business Administration programs. While the proposed degree is not an MBA, it is a graduate degree in business and students without the courses nmally taken as part of an undergraduate business maj would not have the background necessary to succeed AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 10 of 22 Printed:

11 ACCT 610 ACCT 210 & ACCT 211 & BADM 350 BADM 610 BADM 310 & ECON 201 & ECON 202 BADM 620 BADM 220 Proposed NSU* MS BAFS (12 credits) Comparison of courses required f students without an undergraduate degree in business Comparing NSU s MS BAFS with USD and DSU MBA programs Foundations of Accounting and Business Law Foundations of Economics and Finance Quantitative Procedures f Business ACCT 520 BADM 505 BADM 520 BADM 525 USD MBA (18 credits) Foundations of Accounting Foundations of Finance Foundations of Calculus & Statistics Foundations of Operations Management ACCT 610 ACCT 210 & ACCT 211 & BADM 350 BADM 610 BADM 310 & ECON 201 & ECON 202 BADM 608 BADM 220 DSU MBA (12 credits) Foundations of Accounting and Business Law Foundations of Economics and Finance Business Statistics BADM 680 BADM 360 & BADM 370 Foundations of Management/ Marketing BADM 580 Foundations of Marketing and Organizational Behavi BADM 660 BADM 360 & BADM 370 Foundations of Business Practice *Graduate level foundation courses are available from DSU; NSU is willing to accept courses offered within the regental system offered by other regionally accredited institutions in place of the foundation courses listed above f students who do not have an undergraduate degree in business. D. Summary of the Degree (modify table as needed) Master of Science in Banking and Financial Services Credits Percent Students without an Undergraduate Business Degree Knowledge Foundation Courses Required courses, all students (ce) Required option specialization Electives Total required f the degree Students with an Undergraduate Business Degree Required courses, all students (ce) Required option specialization Electives Total required f the degree Required Courses (27 ce credits + 9 specialization credits = 36) AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 11 of 22 Printed:

12 Prefix & Num Course Title Credits New Students without an Undergraduate Business Degree ACCT 610* Foundations of Accounting and Business Law 3 N* BADM 680 Foundations of Management and Marketing 3 N BADM 610* Foundations of Economics and Finance 3 N* BADM 620 Foundations of Statistics 3 N *Available from DSU All Students (Ce) ACCT 710 Accounting f Banking 3 Yes BFS 710 Banking and Financial Markets 3 Yes BFS 715 Communication and Team Dynamics 3 Yes BFS 720 Wealth Management & Planning 3 Yes BFS 725 Marketing of Financial Services 3 Yes BFS 730 Regulation and Compliance 3 Yes BFS 735 Applied Econometrics 3 Yes BFS 740 Enterprise Risk Management 3 Yes BFS 785 Capstone: Strategic Management 3 Yes International Banking Specialization BFS 762 Cultures and Communication 3 Yes BFS 765 International Economic They 3 Yes BFS 767 International Banking 3 Yes Commercial Banking Specialization BFS 770 Examination Process 3 Yes BFS 772 Asset and Liability Management 3 Yes BFS 775 Lending 3 Yes *Available from DSU NSU is willing to accept other graduate courses offered within the regental system offered by other regionally accredited institutions in place of the foundation courses listed above f students who do not have an undergraduate degree in business. The purpose of the foundation courses are to ensure that students have the background knowledge in business needed to succeed in the Banking and Financial Services masters program AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 12 of 22 Printed:

13 Elective Courses in the Program: List courses that may be taken as electives in the program. Indicate any new courses to be added specifically f the maj. Prefix & Num Course Title Credit Hours New (yes, no) Students select an area of specialization within the Banking and Financial Services program. There are no electives in the program. 3. Student Outcomes & Demonstration of Individual Achievement A. What specific knowledge and competencies, including technology competencies, will all students demonstrate be able to demonstrate befe graduation? The knowledge and competencies should be specific to the program and not routinely expected of all university graduates. Complete Appendix A Outcomes using the system fm. Outcomes discussed below should be the same as those in Appendix A. Program goals include: 1. Graduates will demonstrate knowledge of accounting, management, marketing, and finance as they specifically apply to banking and financial services. 2. Graduates will demonstrate knowledge of and adherence to the regulaty and legal environment of banking and financial services. 3. Graduates will demonstrate applied knowledge of risk management principles and techniques. 4. Graduates will use analytical, technical, and critical thinking skills to anticipate, identify, analyze and solve problems as they specifically apply to banking and financial services. 5. Graduates will demonstrate an ability and willingness to employ ethical principles and legal compliance when making banking and financial services decisions. Appendix A shows how courses in the curriculum apply to these goals. B. What national instruments (examinations) are available to measure individual student achievement in this field? There are no national exams available in this field. However, as noted in Section C, below, students will be required to complete a comprehensive case study in their capstone course as part of their summative experience. In additional to being evaluated by the profess teaching the capstone course, the case studies will be assessed by industry professionals AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 13 of 22 Printed:

14 C. How will mastery by individual students be demonstrated? Describe the specific examinations processes to be used. This is to include external measures. 19 What will be the consequences f students who do not demonstrate mastery? In der to successfully complete the course wk, students will be required to demonstrate their mastery of the course materials through the following assessment measures: Course examinations Written assignments Class discussions Class projects Class presentations In addition, a comprehensive case study will be assigned in the capstone course. The completed cases will be assessed by external evaluats (professionals from the banking and financial services industry). Also, as students complete the program, employer surveys will be used to provide industry feedback on the program. 4. What instructional approaches and technologies will be used to teach courses in the program? This refers to the instructional technologies used to teach courses and NOT the technology applications students are expected to learn. In der to provide students with the opptunity to complete this degree while building their careers, the courses will be taught in an online fmat. The Course Management Tool that is used within the regental system (e.g. Desire2Learn) will be utilized f the online courses. Other technologies, such as Elluminate, will be used to enhance class discussions and online office hours. Academically and professionally qualified business leaders will serve as adjuncts f some of the online courses. Similarly, existing faculty will attend a variety of seminars and wkshops related to banking and financial services, to ensure they are current on the latest issues related to the financial services sect. 5. Did the University engage any developmental consultants 20 to assist with the development of the curriculum? Were any professional accrediting associations consulted during the development of the curriculum? What were the contributions of the consultants and associations to the development of curriculum? See also section 11 below. NSU invited a number of leaders from the banking and financial services industry to serve on the committee that developed the proposed curriculum. The committee was made up of faculty from the School of Business and business leaders from the financial services industry throughout the state of South Dakota. This committee played a critical role in putting together the curriculum, while advising on various matters pertaining to the Master s program. The committee was made up of the following members: Mr. Dick Westra, Dacotah Bank, President/CEO; Ms. 19 What national examination, externally evaluated ptfolio student activity, etc will be used to verify that individuals have attained a high level of competence and identify those who need additional wk? 20 Developmental consultants are experts in the discipline are hired by the university to assist with the development of a new program (content, courses, experiences, etc). Universities are encouraged to discuss the selection of developmental consultants with Board staff. See section 11 below AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 14 of 22 Printed:

15 Cynthia Walsh, US Bank, President; Mr. Bruce Ley, retired bank trust officer; Mr. Bret Afdahl, South Dakota Div. of Banking, Direct; Mr. Tim Ahartz, BankWest, Inc., Sr. Vice President/Chief Risk Officer; Dr. Hillar Neumann, NSU Faculty and committee Chairman; Dr. Doug Ohmer, NSU Faculty; Dr. Stan Vinson, NSU Faculty; Dr. Bill Broucek, NSU Dean of the School of Business. Additionally, management in the School of Business has consulted and obtained advice from members of the NSU School of Business Banking and Financial Services Advisy Committee. These individuals provided valuable insights into the needs of industry. This will in turn, provide students with the education and skills needed by top-level executives in the banking and financial services industry. 6. Are students in the program expected to be new to the university, redirected from other programs both? Complete the table and explain how the estimates were developed. The program is designed to meet the needs of stakeholders (e.g. employers) in the banking and financial services industry, as well as their current and potential employees, many of whom are interested in furthering their education. The students in this program are expected to be new to the University. NSU does not expect to redirect students from its master s program in Education. It is anticipated that the majity of the students will have an undergraduate degree in business, although it is expected that some students with undergraduate degrees in non-business disciplines will enroll in this program, as well. The students who do not have the foundation courses in business will be expected to complete the applicable foundation courses befe enrolling in the program. The enrollment projections are based on part-time students who are expected to complete six 3-credit courses per year (2 in fall, 2 in spring, 2 in summer), and will thus be expected to graduate in two years. The enrollment in the initial years of the Master of Banking and Financial Services is projected to grow from approximately 20 students the first year to 25 students by year 4. Allowing f some attrition, the University expects 19 students will graduate after 2 years. Fiscal Years* 1st 2nd 3rd 4th Estimates FY13 FY14 FY15 FY16 Students new to the university Students from other university programs Continuing students (attrition = 1 each coht) = Total students in the program (fall) Program credit hours (maj courses)** Graduates * Do not include current fiscal year. ** This is the total number of credit hours generated by students in the program in the required elective program courses. The same numbers are used in Appendix B Budget AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 15 of 22 Printed:

16 7. If program accreditation is available, identify the ganization and explain whether accreditation is required optional, the resources required, and the University s plans concerning the accreditation of this program. NSU s School of Business is in candidacy f accreditation by the Accreditation Council f Business Schools and Programs (ACBSP). New programs are not accredited until they have been approved and students are enrolled. NSU anticipates that the School will be successful in achieving accreditation by ACBSP and plans to apply f accreditation f the M.S. in Banking and Financial Services after it has begun. No additional costs are projected f expanding the accreditation candidacy to include this program. 8. Does the University request any exceptions to any Board policy f this program? Explain any requests f exceptions to Board Policy. If no exceptions are requested, enter None. None. 9. Program Delivery A. Does the University request authization to deliver this entire program at any offcampus locations? If yes, list location(s) and intended start date(s). No, NSU does not request authization to deliver the entire program at any off-campus location. B. Does the University request authization to deliver this entire program by distance technology? If yes, identify delivery method(s) and intended start date(s). Yes, NSU requests the authization to deliver this entire program by distance technology (Internet). The only exception is the summer capstone course, which will be offered as a hybrid course. C. Include off-campus tuition and site delivery costs in the next section and in Appendix B. If off-campus distance delivery authization is not requested, enter None. The program will be delivered in an online fmat, funded with self-suppt revenue. Appendix B addresses the costs and revenue. 10. Costs, Budget and Resources Explain the amount and source(s) of any one-time and continuing investments in personnel, professional development, release time, time redirected from other assignments, instructional technology & software, other O&M, facilities, etc needed to implement the proposed maj. Address off-campus distance AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 16 of 22 Printed:

17 delivery separately. Complete Appendix B Budget and Resources and briefly summarize. The program budget is provided in Appendix B. Nthern State University does not request new state resources. The University intends to suppt the program with self-suppt tuition revenue and redirection of existing faculty. Two business faculty will be redirected to teach graduate courses in place of undergraduate courses. Larger classrooms will be utilized and class sizes will be increased slightly in the undergraduate courses to accommodate this change without impacting the quality of the educational experience. In addition, professionals with the necessary academic qualifications have expressed interest in teaching in the program as adjunct faculty and will be hired as needed. Revenue that is generated from self-suppt tuition will be use to pay the adjunct faculty salaries. 11. Board Policy 2:1: Proposals f new graduate programs shall be evaluated by independent consultants retained by the Board. Provide the names, telephone numbers, and URLs of professional ganizations, accrediting bodies, and journals (edits) who may be able to assist the Board staff with the identification of consultants. Sam Houston State University, Executive MBA in Banking and Financial Institutions: Boston University, MS specialization in Banking & Financial Services Management: University of South Carolina, Professional MBA, Banking Track: Suffolk University (Massachusetts), M.S. in Financial Services and Management: Pace University, Financial Management M.S.: St. Joseph s University, M.S. in Financial Services: American Bankers Association: Independent Community Bankers of America: South Dakota Bankers Association: Independent Community Bankers of South Dakota: ABA Stonier Graduate School of Banking: Graduate School of Banking at Colado: Graduate School of Banking at the University of Wisconsin, Madison: Moe School of Business, University of South Carolina, banking track: AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 17 of 22 Printed:

18 12. Additional Infmation. Additional infmation is optional. Use this space f infmation not requested above. Limit the number and length of additional attachments. Identify with capital letters. Letters of suppt are not necessary and are rarely included with Board materials. In some cases, response to questions from the Board the Executive Direct may be provided as appendixes to the iginal proposal. This item may be deleted if it is not used. Admissions Requirements Admission to the program will require evidence of each of the following: 1) Undergraduate degree in a business field Undergraduate degree in a non-business field and completion of foundation courses in Accounting and Business Law, Finance and Economics, Management and Marketing, and Business Statistics 2) Minimum undergraduate GPA of 2.75 GPA of 3.00 better during last two years of equivalent wk in undergraduate studies GPA of 3.25 in maj area of undergraduate study 3) Minimum GMAT sce of 500 Minimum GRE sce of 800 4) If an International Student: a) All of the above and b) Minimum paper-based TOEFL sce of 550 Minimum computer-based TOEFL sce of 213 Minimum Internet TOEFL sce of 80 Recruitment Plan Existing resources will be reallocated to cover the cost of promoting this program. Planned recruitment activities include the following: Advertising campaigns in the American Bankers Association Banking Journal and other ABA publications, South Dakota Bankers Association magazine, Independent Community Bankers of South Dakota publications, and other industry-related journals Listings in International Embassy and Consulate directies Program brochures NSU s Banking and Financial Services program website Direct mail in response to student inquiries Advertisements in in-flight magazines Newspaper advertising Cable TV advertising in our market area (ND, MN, SD) on financial news channels AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 18 of 22 Printed:

19 Program Management A School of Business faculty member will be given a quarter release time to serve as program direct. Policies and procedures will be administered by the NSU Office of Graduate Programs, with oversight from the program direct and dean in terms of admissions eligibility, probation, suspension, readmission, etc. (see below). Admissions decisions: - The Graduate Office will handle the processing of admissions requests, with oversight by the program direct; the program direct will take ultimate responsibility f the admission of students, with input from the dean and faculty members. Probation, suspension, readmission: - Faculty will notify the dean and program direct of potential problems and will provide the dean with a listing of students who have deficiencies; the dean will approve deny readmission requests, if the need should arise. The Graduate Office will handle the paperwk f probation, suspension, and readmission. Recruitment plan: - The program direct will handle the details related to the recruitment plan but the dean will oversee recruitment; department chairs and faculty will have input. Assignment of advis: - The dean, with guidance from the department chairs and program direct, will assign faculty who teach in the program as adviss to the graduate students; the program direct will review student progress and schedules to ensure that students stay on target f graduation; the direct will collabate with the applicable advis in notifying students of potential problem areas. Course schedules: - The department chairs and faculty will schedule the courses, in collabation with the dean and program direct; this group will collabatively review the various faculty/class schedules to avoid potential conflicts. The dean and department chairs are ultimately responsible f the class schedules AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 19 of 22 Printed:

20 Appendix A M.S. in Banking and Financial Services Student Learning Outcomes Mapped to Required Ce Courses Individual Student Outcomes Graduates will demonstrate knowledge of accounting, management, marketing, and finance as they specifically apply to banking and financial services Graduates will demonstrate knowledge of and adherence to the regulaty and legal environment of banking and financial services Graduates will demonstrate applied knowledge of risk management principles and techniques Graduates will use analytical, technical, and critical thinking skills to anticipate, identify, analyze and solve problems as they specifically apply to banking and financial services Graduates will demonstrate an ability and willingness to employ ethical principles and legal compliance when making banking and financial services decisions ACCT 710 BFS 710 BFS 715 BFS 720 BFS 725 BFS 730 BFS 735 BFS 740 X X X X X X X X X X X X X X X X X BFS 785 X X X X X X AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 20 of 22 Printed:

21 Nthern State University, M.S. in Banking and Financial Services 1. Assumptions 1st 2nd 3rd 4th Headcount & hours from proposal FY13 FY14 FY15 FY16 Fall headcount* Program FY cr hrs, State-Suppt Program FY cr hrs, Self-Suppt * Includes 8 students in foundation courses. Faculty, Regular FTE See p Faculty Salary & Benefits, average See p. 2 $98,253 $98,253 $98,253 $98,253 Faculty, Adjunct - courses See p Faculty, Adjunct - per course See p. 2 $4,293 $4,293 $4,293 $4,293 Other FTE (see next page) See p Other Salary & Benefits, average See p. 2 $0 $0 $0 $0 2. Budget Salary & Benefits Faculty, Regular $98,253 $196,505 $196,505 $196,505 Faculty, Adjunct $0 $12,879 $12,879 $12,879 Other $0 $0 $0 $0 S&B Subtotal $98,253 $209,384 $209,384 $209,384 Operating Expenses Travel $0 $0 $0 $0 Contractual Services $0 $0 $0 $0 Supplies & materials $0 $0 $0 $0 Capital equipment $0 $0 $0 $0 OE Subtotal $0 $0 $0 $0 Total $98,253 $209,384 $209,384 $209, Program Resources Self-suppt Tuition/Cr Hr, if applicable Graduate $ $ $ $ Self-suppt tuition revenue [hrs x rate] $132,480 $271,584 $298,080 $317,952 Self-suppt HEFF/credit hour Graduate $34.65 $34.65 $34.65 $34.65 Revenue to HEFF $12,474 $25,572 $28,067 $29,938 Net self-suppt tuition revenue $120,006 $246,012 $270,014 $288,014 Discipline fee (if any) $0 $0 $0 $0 University redirections $0 $0 $0 $0 Community/Employer $0 $0 $0 $0 Grants/Other $0 $0 $0 $0 Total Resources $120,006 $246,012 $270,014 $288, AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 21 of 22 Printed:

22 Resources Over (Under) Budget $21,753 $36,628 $60,630 $78,630 Provide a summary of the program costs and resources in the new program proposal. Estimated Salary & Benefits per FTE Faculty Adjuncts Estimated salary (average) - explain below $80,351 $3,951 University's variable benefits rate (see below) Variable benefits $11,767 $342 Health insurance/fte, FY12 $6,135 Average S&B $98,253 $4,293 Explain faculty used to develop the average salary & fiscal year salaries used. Enter amount above. The FY11 salaries of the faculty in the department who will be teaching in this program were averaged. Explain adjunct faculty costs used in table: Three (3) courses per year to be taught by adjuncts at $3,951 per course. (This is the current salary paid to NSU adjuncts with a terminal degree.) Explain other [f example, CSA exempt] salary & benefits. Enter amount above. No additional staff is needed. Summarize the operating expenses shown in the table: No additional operating expenses are anticipated. Travel to conferences, etc. are already part of the institutional budget. Summarize resources available to suppt the new program (redirection, grants, etc). Select full-time faculty will be redirected from undergraduate courses to graduate courses. Adjuncts will be paid with revenue from the self-suppt tuition in the online courses. Variable Benefits Rates Self-Suppt Tuition & HEFF Rates Rate HEFF Use in the table above. Change cells on page 1 use crect rates. FY12 FY12 FY12 Undergraduate $ $22.86 BHSU % Graduate $ $34.65 DSU % Externally Suppted $40.00 NSU % SDSM&T % SDSU % USD % AAC_4.A.1_new_prog_NSU-MS-Banking_FinServices Page 22 of 22 Printed: