Barings Bank
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Barings Bank was a British
merchant bank A merchant bank is historically a bank dealing in commercial loans and investment. In modern British usage it is the same as an investment bank. Merchant banks were the first modern banks and evolved from medieval merchants who traded in commodi ...
based in London, and one of England's oldest merchant banks after
Berenberg Bank Joh. Berenberg, Gossler & Co. KG, commonly known as Berenberg Bank and also branded as simply Berenberg, is a multinational full-service investment bank based in Hamburg, Germany. It was founded by the Flemish Berenberg family in 1590 () and ...
, Barings' close collaborator and German representative. It was founded in 1762 by Francis Baring, a British-born member of the German-British
Baring family The Baring family is a German and British family of merchants and bankers. In Germany, the family belongs to the ''Bildungsbürgertum'', and in England, it belongs to the aristocracy. History The family's earliest known ancestor is Peter Baring ...
of merchants and bankers. The bank collapsed in 1995 after suffering losses of £827 million (£ billion in ) resulting from fraudulent investments, primarily in
futures contract In finance, a futures contract (sometimes called a futures) is a standardized legal contract to buy or sell something at a predetermined price for delivery at a specified time in the future, between parties not yet known to each other. The asset ...
s, conducted by its employee
Nick Leeson Nicholas William Leeson (born 25 February 1967) is an English former derivatives trader whose fraudulent, unauthorized and speculative trades resulted in the 1995 collapse of Barings Bank, the United Kingdom's oldest merchant bank. Leeson w ...
, working at its office in
Singapore Singapore (), officially the Republic of Singapore, is a sovereign island country and city-state in maritime Southeast Asia. It lies about one degree of latitude () north of the equator, off the southern tip of the Malay Peninsula, borde ...
.


History


1762–1889

Barings Bank was founded in 1762 as the John and Francis Baring Company by
Sir Francis Baring, 1st Baronet Sir Francis Baring, 1st Baronet (18 April 1740 – 11 September 1810) was an English merchant banker, a member of the Baring family, later becoming the first of the Baring baronets. Early life He was born at Larkbeare House near Exeter, son ...
, with his older brother John Baring as a mostly silent partner. They were sons of John (né Johann) Baring, wool trader of
Exeter Exeter () is a city in Devon, South West England. It is situated on the River Exe, approximately northeast of Plymouth and southwest of Bristol. In Roman Britain, Exeter was established as the base of Legio II Augusta under the personal comm ...
, born in
Bremen Bremen (Low German also: ''Breem'' or ''Bräm''), officially the City Municipality of Bremen (german: Stadtgemeinde Bremen, ), is the capital of the German state Free Hanseatic City of Bremen (''Freie Hansestadt Bremen''), a two-city-state consis ...
,
Germany Germany,, officially the Federal Republic of Germany, is a country in Central Europe. It is the second most populous country in Europe after Russia, and the most populous member state of the European Union. Germany is situated betwe ...
. The company started business in offices off
Cheapside Cheapside is a street in the City of London, the historic and modern financial centre of London, which forms part of the A40 London to Fishguard road. It links St. Martin's Le Grand with Poultry. Near its eastern end at Bank junction, where ...
in London, and within a few years moved to larger quarters in
Mincing Lane Mincing Lane is a short one-way street in the City of London linking Fenchurch Street to Great Tower Street. In the late 19th century it was the world's leading centre for tea and spice trading. Etymology Its name is a corruption of Mynchen ...
.D. Kinaston. The
City of London The City of London is a city, ceremonial county and local government district that contains the historic centre and constitutes, alongside Canary Wharf, the primary central business district (CBD) of London. It constituted most of London fr ...
, Volume I. London: Pimlico, 1994
Barings gradually diversified from wool into many other commodities, providing financial services for the rapid growth of international trade, including the lucrative
slave trade Slavery and enslavement are both the state and the condition of being a slave—someone forbidden to quit one's service for an enslaver, and who is treated by the enslaver as property. Slavery typically involves slaves being made to perf ...
which enriched the family and the business considerably and allowed significant expansion of the bank's activities and prestige. The success of Baring's was greatly influenced by establishment of a network of corresponding houses. One of the most valuable connections was Hope & Co., the most powerful merchant bank of
Amsterdam Amsterdam ( , , , lit. ''The Dam on the River Amstel'') is the Capital of the Netherlands, capital and Municipalities of the Netherlands, most populous city of the Netherlands, with The Hague being the seat of government. It has a population ...
, at that time Europe's leading financial centre. Hope & Co played a major part in the finances of the
Dutch East India Company (VOC) The United East India Company ( nl, Verenigde Oostindische Compagnie, the VOC) was a chartered company established on the 20th March 1602 by the States General of the Netherlands amalgamating existing companies into the first joint-stock ...
and during the
Seven Years' War The Seven Years' War (1756–1763) was a global conflict that involved most of the European Great Powers, and was fought primarily in Europe, the Americas, and Asia-Pacific. Other concurrent conflicts include the French and Indian War (1754 ...
(1756–1763) Thomas Hope and his brother Adria profited from the Netherlands' neutral position. In 1774, Barings started business in North America. By 1790, Barings had greatly expanded its resources, both through Francis's efforts in London and by association with Hope & Co. In 1793, the increased business necessitated a move to larger quarters in Devonshire Square. In 1796, the bank helped to finance the purchase of about 1 million acres (4000 km2) of remote land that became part of the US state of
Maine Maine () is a state in the New England and Northeastern regions of the United States. It borders New Hampshire to the west, the Gulf of Maine to the southeast, and the Canadian provinces of New Brunswick and Quebec to the northeast and north ...
. In 1800, John retired and the company was reorganized as Francis Baring and Co.. Francis's new partners were his eldest son Thomas (later to be Sir Thomas Baring, 2nd Baronet) and son-in-law, Charles Wall. Then, in 1802, Barings and Hope & Co. were called on to facilitate the largest land purchase in history: the
Louisiana Purchase The Louisiana Purchase (french: Vente de la Louisiane, translation=Sale of Louisiana) was the acquisition of the territory of Louisiana by the United States from the French First Republic in 1803. In return for fifteen million dollars, or app ...
, which doubled the size of the United States. It is regarded as "one of the most historically significant trades of all time". This was accomplished even though Britain was at war with France and the sale helped to finance
Napoleon Napoleon Bonaparte ; it, Napoleone Bonaparte, ; co, Napulione Buonaparte. (born Napoleone Buonaparte; 15 August 1769 – 5 May 1821), later known by his regnal name Napoleon I, was a French military commander and political leader who ...
's war effort. Technically, the United States purchased Louisiana from Barings and Hope, not from Napoleon. Baring was willing to help Napoleon in the short term because he, and British politicians who backed him, predicted that American expansion into Louisiana would ensure Barings' profits in Britain. After a $3 million down payment in gold, the remainder of the purchase was made in United States bonds, which Napoleon sold to Barings through Hope & Co. of Amsterdam at a price of $87.50 per $100 face value (a discount of one-eighth). Francis's second son
Alexander Baring, 1st Baron Ashburton Alexander Baring, 1st Baron Ashburton, PC (27 October 177412 May 1848), of The Grange in Hampshire, of Ashburton in Devon and of Buckenham Tofts near Thetford in Norfolk, was a British politician and financier, and a member of the Baring famil ...
, working for Hope & Co., made the arrangements in Paris with
François Barbé-Marbois François Barbé-Marbois, marquis de Barbé-Marbois (31 January 1745 – 12 February 1837) was a French politician. Early career Born in Metz, where his father was director of the local mint, Barbé-Marbois tutored the children of the Marquis d ...
, director of the Public Treasury. Alexander then sailed to the United States and back to pick up the bonds and deliver them to France. In 1803, Francis began to withdraw from active management, bringing in Thomas's younger brothers Alexander and Henry to become partners in 1804. The new partnership was called Baring Brothers & Co., which it remained until 1890. The offspring of these three brothers became the future generations of Barings leadership. In 1806, the company relocated to 8
Bishopsgate Bishopsgate was one of the eastern gates in London's former defensive wall. The gate gave its name to the Bishopsgate Ward of the City of London. The ward is traditionally divided into ''Bishopsgate Within'', inside the line wall, and ''Bishop ...
, where it stayed for the remaining life of the company. The building underwent several expansions and refurbishments, and was ultimately replaced with a new high-rise building in 1981. Barings helped to finance the United States government during the
War of 1812 The War of 1812 (18 June 1812 – 17 February 1815) was fought by the United States of America and its indigenous allies against the United Kingdom and its allies in British North America, with limited participation by Spain in Florida. It bega ...
. By 1818, Barings was called "the sixth great European power", after England, France, Prussia, Austria and Russia. A fall-off in business and some poor leadership in 1820s caused Barings to cede its dominance in the City of London to the rival firm of
N M Rothschild & Sons Rothschild & Co is a multinational Investment banking, investment bank and financial services company, and the flagship of the Rothschild banking group controlled by the French and British branches of the Rothschild family. The banking business o ...
. Barings remained a powerful firm, however, and in the 1830s the leadership of new American partner Joshua Bates, together with
Thomas Baring (1799–1873) Thomas Baring (7 September 1799 – 18 November 1873) was a British banker and Conservative Party politician. Background and education Baring was the second son of Sir Thomas Baring, 2nd Baronet, and Mary Ursula, daughter of Charles Sealy. Franc ...
, son of Sir Thomas Baring, 2nd Baronet, began a turnaround. Bates advocated a shift in Barings' efforts from Europe to the Americas, believing that greater opportunity lay in the West. In 1832, a Barings office was established in Liverpool specifically to capitalise on new North American opportunities. In 1843, Barings became an exclusive agent to the US government. Barings was appointed by
Sir Robert Peel Sir Robert Peel, 2nd Baronet, (5 February 1788 – 2 July 1850) was a British Conservative statesman who served twice as Prime Minister of the United Kingdom (1834–1835 and 1841–1846) simultaneously serving as Chancellor of the Exchequer ...
to supply "Indian corn" (
maize Maize ( ; ''Zea mays'' subsp. ''mays'', from es, maíz after tnq, mahiz), also known as corn (North American and Australian English), is a cereal grain first domesticated by indigenous peoples in southern Mexico about 10,000 years ago. Th ...
) to Ireland for famine relief between November 1845 and July 1846, after the staple potato crop failed. The company declined to act beyond 1846, when the government instructed it to restrict its purchases to within Britain. Baring Brothers stated it would refuse future commissions in famine relief, with the blame this could so easily entail. Its position as the prime purchaser of Indian corn was assumed by Erichson, a corn factor of Fenchurch St, London. In 1851, Baring and Bates brought in another American,
Russell Sturgis (1805-1887) Russell Sturgis (; October 16, 1836 – February 11, 1909) was an American architect and art critic of the 19th and early 20th centuries. He was one of the founders of the Metropolitan Museum of Art in 1870. Sturgis was born in Baltimore Cou ...
, as a partner. Despite the embarrassment to his partners caused by his sympathies for the South in the
American Civil War The American Civil War (April 12, 1861 – May 26, 1865; also known by other names) was a civil war in the United States. It was fought between the Union ("the North") and the Confederacy ("the South"), the latter formed by states th ...
, Sturgis proved a capable banker. Baring did not deal in U.S. bonds, but it did help fund the American purchases of armaments. After the death of Bates in 1864, Sturgis gradually assumed a leadership role. In the 1850s and 1860s, the commercial credit business provided the firm with its basic income. Thomas Baring's nephew Edward, son of
Henry Baring Henry Baring (18 January 1777 – 13 April 1848) was a British banker and politician. He was the third son of Sir Francis Baring, 1st Baronet, the founder of the family banking firm that grew into Barings Bank. His grandfather Johann Baring em ...
, became a partner in 1856. By the 1870s, under the emerging leadership of "Ned" Baring, later
Edward Baring, 1st Baron Revelstoke Edward Charles Baring, 1st Baron Revelstoke (13 April 1828 – 17 July 1897), was a British banker. Early life A member of the Baring banking family, "Ned" Baring was born on 13 April 1828. He was the second son of Henry Baring from his second ma ...
, Barings were increasingly involved in international securities, especially from the United States, Canada, and Argentina. Barings cautiously and successfully ventured into the North American railroad boom following the Civil War. A new railroad town was renamed
Revelstoke, British Columbia Revelstoke () is a city in southeastern British Columbia, Canada, with a census population of 8,275 in 2021. Revelstoke is located east of Vancouver, and west of Calgary, Alberta. The city is situated on the banks of the Columbia River just sout ...
, in honour of the leading partner of the bank that enabled the completion of the Canadian-Pacific Railway. Barings also helped to finance major railways including the
Atchison, Topeka and Santa Fe Railway The Atchison, Topeka and Santa Fe Railway , often referred to as the Santa Fe or AT&SF, was one of the larger railroads in the United States. The railroad was chartered in February 1859 to serve the cities of Atchison, Kansas, Atchison and Top ...
. "Ned Baring" had a daughter,
Margaret Baring Charles Robert Spencer, 6th Earl Spencer, (30 October 1857 – 26 September 1922), styled The Honourable Charles Spencer until 1905 and known as Viscount Althorp between 1905 and 1910, was a British courtier and Liberal politician from the Spen ...
, who was a great-grandmother of
Diana, Princess of Wales Diana, Princess of Wales (born Diana Frances Spencer; 1 July 1961 – 31 August 1997) was a member of the British royal family. She was the first wife of King Charles III (then Prince of Wales) and mother of Princes William and Harry. Her ac ...
. In 1886, the bank helped broker the listing of the
Guinness Guinness () is an Irish dry stout that originated in the brewery of Arthur Guinness at St. James's Gate, Dublin, Ireland, in 1759. It is one of the most successful alcohol brands worldwide, brewed in almost 50 countries, and available in ove ...
brewery.


Collapse of 1890

In the late 1880s, daring efforts in underwriting got the firm into serious trouble through overexposure to Argentine and Uruguayan debt. In 1890, Argentine president
Miguel Juárez Celman --> Miguel is a given name and surname, the Portuguese and Spanish form of the Hebrew name Michael. It may refer to: Places * Pedro Miguel, a parish in the municipality of Horta and the island of Faial in the Azores Islands * São Miguel (disam ...
was forced to resign following the
Revolución del Parque The Revolution of the Park (''Revolución del Parque''), also known as the Revolution of '90, was an uprising against the national government of Argentina that took place on July 26, 1890, and started with the takeover of the Buenos Aires Artille ...
, and the country was close to defaulting on its debt payments. This crisis finally exposed the vulnerability of Barings, which lacked sufficient reserves to support the Argentine bonds. Through the organisational skills of the governor of the Bank of England,
William Lidderdale William Lidderdale (16 July 1832 – 26 June 1902) was a British merchant, and governor of the Bank of England between 1889 and 1892.Cassis, Youssef''City bankers, 1890–1914'' Cambridge; New York: Cambridge University Press, 1994, p. 84, . L ...
, a consortium of banks was arranged, headed by former governor Henry Hucks Gibbs and his family firm of Antony Gibbs & Sons, to bail Barings out and support a bank restructuring. The resulting turmoil in financial markets became known as the
Panic of 1890 Panic is a sudden sensation of fear, which is so strong as to dominate or prevent reason and logical thinking, replacing it with overwhelming feelings of anxiety and frantic agitation consistent with an animalistic fight-or-flight reactio ...
.


Reduced role: 1891–1929

The rescue avoided what could have been a worldwide financial collapse, but Barings never regained its dominant position. A
limited liability company A limited liability company (LLC for short) is the US-specific form of a private limited company. It is a business structure that can combine the pass-through taxation of a partnership or sole proprietorship with the limited liability of a ...
—Baring Brothers & Co., Ltd.— was formed, to which the viable business of the old partnership was transferred. The assets of the old house and several partners were taken over and liquidated to repay the rescue consortium, with guarantees provided by the Bank of England. Lord Revelstoke and others lost their partnerships along with their personal fortunes, which were pledged to support the bank. Nearly 10 years elapsed before the debts were paid. Revelstoke did not live to see this accomplished, dying in 1897. Barings did not return to issuance on a substantial scale until 1900, concentrating on securities in the United States and Argentina. It operated under the leadership of Edward's son John Baring, 2nd Baron Revelstoke in the early years of the 20th century The company's restraint during this period cost it its pre-eminence in the world of finance, but later paid dividends when its refusal to take a chance on financing Germany's recovery from World War I saved it some of the most painful losses incurred by other British banks at the onset of the
Great Depression The Great Depression (19291939) was an economic shock that impacted most countries across the world. It was a period of economic depression that became evident after a major fall in stock prices in the United States. The economic contagio ...
.


1929–1992

During the Second World War, the British government used Barings to liquidate assets in the United States and elsewhere to help finance the war effort. After the war, Barings was overtaken in size and influence by other banking houses, but remained an important player in the market until 1995. The bank decided to enter the UK securities market buying Henderson Crosthwaite, a stockbroker, in May 1984 and Wilson & Watford, a stock jobber, in November 1985.


1992–1995

Barings was brought down in 1995 by a massive trading loss caused by fraudulent trading by its head
derivatives The derivative of a function is the rate of change of the function's output relative to its input value. Derivative may also refer to: In mathematics and economics * Brzozowski derivative in the theory of formal languages * Formal derivative, an ...
trader in
Singapore Singapore (), officially the Republic of Singapore, is a sovereign island country and city-state in maritime Southeast Asia. It lies about one degree of latitude () north of the equator, off the southern tip of the Malay Peninsula, borde ...
since 1992,
Nick Leeson Nicholas William Leeson (born 25 February 1967) is an English former derivatives trader whose fraudulent, unauthorized and speculative trades resulted in the 1995 collapse of Barings Bank, the United Kingdom's oldest merchant bank. Leeson w ...
. Leeson was supposed to be arbitraging, seeking to profit from differences in the prices of
Nikkei 225 The Nikkei 225, or , more commonly called the ''Nikkei'' or the ''Nikkei index'' (), is a stock market index for the Tokyo Stock Exchange (TSE). It has been calculated daily by the '' Nihon Keizai Shimbun'' (''The Nikkei'') newspaper since 1950 ...
futures contracts listed on the
Osaka Securities Exchange , renamed from , is the largest derivatives exchange in Japan, in terms of amount of business handled. , the Osaka Securities Exchange had 477 listed companies with a combined market capitalization of $212 billion. The Nikkei 225 Futures, intro ...
in Japan and on the
Singapore International Monetary Exchange The Singapore Exchange Limited (SGX) is a Singaporean investment holding company that provides different services related to securities and derivatives trading and others. SGX is also a member of the World Federation of Exchanges and the Asia ...
(SIMEX). However, instead of buying on behalf of clients on one market and immediately selling on another market for a small profit, using the strategy approved by his superiors, Leeson stated undertaking such trades using the bank's own money, gambling on the future direction of the Japanese markets. According to
Eddie George Edward Nathan George Jr. (born September 24, 1973) is an American football coach and former player who is the current head coach at Tennessee State. He played as a running back in the National Football League (NFL) for nine seasons, primarily f ...
, Governor of the
Bank of England The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694 to act as the English Government's banker, and still one of the bankers for the Government of ...
, Leeson began doing this at the end of January 1992. Due to a series of internal and external events, his unhedged losses escalated rapidly.


Internal control

Leeson was general manager for Barings' trading on SIMEX. Barings circumvented normal accounting, internal control and audit safeguards by making Leeson head of settlement operations for SIMEX, charged with ensuring accurate accounting for the unit. These positions would normally have been held by different employees. With authority to settle his own trades, Leeson was able to operate with no supervision from London—an arrangement that made it easier for him to hide his losses. After the collapse, several observers placed much of the blame on the bank's own deficient internal control and risk management practices. A number of people had raised concerns over Leeson's activities but were ignored.


Corruption

Because of the absence of oversight, Leeson was able to make seemingly small gambles in the futures
arbitrage In economics and finance, arbitrage (, ) is the practice of taking advantage of a difference in prices in two or more markets; striking a combination of matching deals to capitalise on the difference, the profit being the difference between the ...
market at Barings Futures Singapore and cover up his shortfalls by reporting losses as gains to Barings in London. Specifically, Leeson altered the branch's error account, subsequently known by its account number 88888 as the "five-eights account", to prevent the London office from receiving the standard daily reports on trading, price and status. Leeson claimed the losses started when one of his colleagues bought 20 contracts when she should have sold them, costing Barings £20,000. By December 1994, Leeson had cost Barings £200 million. He reported to British tax authorities a £102 million profit. If the company had uncovered his true financial dealings then, collapse might have been avoided as Barings still had £350 million of capital.


Kobe earthquake

Using the hidden five-eights account, Leeson began to trade aggressively in futures and options on SIMEX. His decisions routinely resulted in losses of substantial sums and he used money entrusted to the bank by subsidiaries for use in their own accounts. He falsified trading records in the bank's computer systems and used money intended for margin payments on other trading. As a result, he appeared to be making substantial profits. However, his luck ran out when the
Kobe earthquake The , or Kobe earthquake, occurred on January 17, 1995, at 05:46:53 JST (January 16 at 20:46:53 UTC) in the southern part of Hyōgo Prefecture, Japan, including the region known as Hanshin. It measured 6.9 on the moment magnitude scale and had ...
upset the Asian financial markets—and with them, Leeson's investments. Leeson bet on a rapid recovery by the Nikkei, which failed to materialise.


Discovery

On 23 February 1995, Leeson left Singapore to fly to
Kuala Lumpur , anthem = '' Maju dan Sejahtera'' , image_map = , map_caption = , pushpin_map = Malaysia#Southeast Asia#Asia , pushpin_map_caption = , coordinates = , su ...
. Barings Bank auditors discovered the fraud around the time that Barings' chairman Peter Baring received a confession note from Leeson. Leeson's activities had generated losses totalling £827 million ($1.3 billion), twice the bank's available trading capital. The collapse cost another £100 million. The Bank of England attempted an unsuccessful weekend bailout, and employees around the world did not receive their bonuses. Barings was declared insolvent on 26 February 1995, and administrators began managing the finances of Barings Group and its subsidiaries. The same day, the Board of Banking Supervision of the Bank of England launched an investigation led by Britain's Chancellor of the Exchequer; its report was released on 18 July 1995. Leeson was captured after spending 272 days on the run and sentenced to six years and six months imprisonment, served in Singapore's
Changi Prison Changi Prison Complex, often known simply as Changi Prison, is a prison in Changi in the eastern part of Singapore. History First prison Before Changi Prison was constructed, the only penal facility in Singapore was at Pearl's Hill, beside t ...
for his wrongdoings.


Aftermath

Dutch bank
ING Ing, ING or ing may refer to: Art and media * '' ...ing'', a 2003 Korean film * i.n.g, a Taiwanese girl group * The Ing, a race of dark creatures in the 2004 video game '' Metroid Prime 2: Echoes'' * "Ing", the first song on The Roches' 1992 ...
purchased Barings Bank in 1995 for the nominal sum of £1 and took over all of Barings' liabilities, forming the subsidiary ING Barings. In 2001, ING sold the US-based operations to
ABN Amro ABN or abn may refer to: Companies * ABN AMRO Group, a Dutch bank group * ABN AMRO, sometimes referred to as "ABN" in shorthand, is a Dutch state-owned bank * Algemene Bank Nederland, a now-defunct Dutch bank Radio, news and television organizat ...
for $275 million and folded the rest of ING Barings into its European banking division. This left only the asset management division,
Baring Asset Management Barings LLC, known as Barings, is an international investment management firm owned by Massachusetts Mutual Life Insurance Company (MassMutual). It operates as a subsidiary of MassMutual Financial Group, a diversified financial services organisat ...
. In March 2005, BAM was split and sold by ING to
MassMutual The Massachusetts Mutual Life Insurance Company, also known as MassMutual, is a Springfield, Massachusetts-based life insurance company. MassMutual provides financial products such as life insurance, disability income insurance, long term ...
, which acquired BAM's investment management activities and the rights to use the Baring Asset Management name, and
Northern Trust Northern Trust Corporation is a financial services company headquartered in Chicago that caters to corporations, institutional investors, and ultra high net worth individuals. Northern Trust is one of the largest banking institutions in the Un ...
, which acquired BAM's Financial Services Group. Barings Bank no longer has a separate corporate existence, although the ''Barings'' name still lives on as the MassMutual subsidiary Baring Asset Management. In March 2016, a merger was announced with other asset management subsidiaries of MassMutual, creating a new "Barings" headquartered in Charlotte, NC. Baring Private Equity International was acquired by its respective management teams, which today include
Baring Vostok Capital Partners Baring Vostok Capital Partners is the largest independent private equity firm focused on investments in Russia and the Commonwealth of Independent States. The Baring Vostok Private Equity Funds invest across a broad range of industries including ...
in Russia,
GP Investments GP Investments (also GP Investimentos), is a leading alternative investment firm in Latin America with a strong presence in asset management, principally private equity funds. The firm's shares are listed on the Luxembourg Stock Exchange and trad ...
in Brazil,
Baring Private Equity Asia BPEA EQT (formerly known as Baring Private Equity Asia and BPEA) is an Asian private equity firm. Previously it was an affiliate of Barings Bank before becoming an independent firm. In 2022 it was acquired by EQT Partners to act as its Asian inve ...
and Baring Private Equity Partners India.


In popular culture and fiction

On 5 April 2007, ''
The Guardian ''The Guardian'' is a British daily newspaper. It was founded in 1821 as ''The Manchester Guardian'', and changed its name in 1959. Along with its sister papers ''The Observer'' and ''The Guardian Weekly'', ''The Guardian'' is part of the Gu ...
'' newspaper reported that
KPMG KPMG International Limited (or simply KPMG) is a multinational professional services network, and one of the Big Four accounting organizations. Headquartered in Amstelveen, Netherlands, although incorporated in London, England, KPMG is a net ...
, the liquidators of Barings, had sold a
trading jacket A trading jacket is a blazer garment worn by a broker who executes trades by open outcry in and around the trading pits of various financial exchanges. Throughout the twentieth century, trading jackets were simply white. Following counterculture o ...
thought to have been worn by Nick Leeson while trading on SIMEX in Singapore. The jacket was offered for sale on
eBay eBay Inc. ( ) is an American multinational e-commerce company based in San Jose, California, that facilitates consumer-to-consumer and business-to-consumer sales through its website. eBay was founded by Pierre Omidyar in 1995 and became a ...
but it failed to reach its reserve price despite a highest bid of £16,100. It was subsequently sold for £21,000. In October 2007 a similar jacket used by Leeson's team but not thought to have been worn by Leeson himself sold at auction for £4,000.


Fiction

The 1999 film ''
Rogue Trader A rogue trader is person who makes financial trades in an unauthorised manner. Rogue trader may also refer to: * ''Rogue Trader'' (book), the autobiography of (and later a movie about) Nick Leeson, the man who caused the collapse of Barings Bank * ...
'' is a fictionalized account of the bank's downfall based upon Leeson's autobiography '' Rogue Trader: How I Brought Down Barings Bank and Shook the Financial World''. In the historical novel ''
Stone's Fall ''Stone's Fall'' is a 2009 historical-mystery novel by Iain Pears. Synopsis An ageing BBC reporter approaching retirement in 1953, Matthew Braddock is on a farewell tour, visiting the old Paris bureau. Chancing upon a familiar name in the obitu ...
'' (2009) by
Iain Pears Iain George Pears (born 8 August 1955) is an English art historian, novelist and journalist. Personal life Pears was born on 8 August 1955 in Coventry, England. He was educated at Warwick School, an all-boys public school in Warwick. He studied ...
, Barings and its role in the
Panic of 1890 Panic is a sudden sensation of fear, which is so strong as to dominate or prevent reason and logical thinking, replacing it with overwhelming feelings of anxiety and frantic agitation consistent with an animalistic fight-or-flight reactio ...
play a significant part in the story's structure. In the novel ''
Around the World in Eighty Days ''Around the World in Eighty Days'' (french: link=no, Le tour du monde en quatre-vingts jours) is an adventure novel by the French writer Jules Verne, first published in French in 1872. In the story, Phileas Fogg of London and his newly employe ...
'' (1872) by
Jules Verne Jules Gabriel Verne (;''Longman Pronunciation Dictionary''. ; 8 February 1828 – 24 March 1905) was a French novelist, poet, and playwright. His collaboration with the publisher Pierre-Jules Hetzel led to the creation of the ''Voyages extraor ...
,
Phileas Fogg Phileas Fogg () is the protagonist in the 1872 Jules Verne novel ''Around the World in Eighty Days''. Inspirations for the character were the American entrepreneur George Francis Train and American writer and adventurer William Perry Fogg. ...
's bet is guaranteed by a cheque for £20,000 drawn on Barings Bank:
As today is Wednesday, the 2nd of October, I shall be due in London in this very room of the Reform Club, on Saturday, the 21st of December, at a quarter before nine p.m.; or else the twenty thousand pounds, now deposited in my name at Barings, will belong to you, in fact and in right, gentlemen. Here is a cheque for the amount.


See also

* CITIC Pacific#2008 foreign exchange losses controversy * Leonard Ingrams, former
Managing Director A chief executive officer (CEO), also known as a central executive officer (CEO), chief administrator officer (CAO) or just chief executive (CE), is one of a number of corporate executives charged with the management of an organization especially ...
and founder of
Garsington Opera Garsington Opera is an annual summer opera festival founded in 1989 by Leonard Ingrams. The Philharmonia Orchestra and The English Concert are its two resident orchestras. For 21 years it was held in the gardens of Ingrams's home at Garsington ...
. *
List of trading losses The following contains a list of trading losses of the equivalent of USD100 million or higher. Trading losses are the amount of principal losses in an account. Because of the secretive nature of many hedge funds and fund managers, some notable los ...
* ''
Re Barings plc (No.5) ''Re Barings plc (No 5)''
000 Triple zero, Triple Zero, Zero Zero Zero, Triple 0, Triple-0, 000, or 0-0-0 may refer to: * 000 (emergency telephone number), the Australian emergency telephone number * "Triple Zero", a song by AFI (band), AFI from ''Shut Your Mouth and Open Your ...
1 BCLC 523 is a leading UK company law case, concerning directors' duties of care and skill. The case is formally identified and cited as "No 5", though some observers regard it as the sixth in the saga of litig ...
''
999 999 or triple nine most often refers to: * 999 (emergency telephone number), a telephone number for the emergency services in several countries * 999 (number), an integer * AD 999, a year * 999 BC, a year Books * ''999'' (anthology) or ''999: T ...
1 BCLC 433 * ''
Rogue Trader A rogue trader is person who makes financial trades in an unauthorised manner. Rogue trader may also refer to: * ''Rogue Trader'' (book), the autobiography of (and later a movie about) Nick Leeson, the man who caused the collapse of Barings Bank * ...
'' – 1999 film starring Ewan McGregor


References


Further reading

* * * * Herring, Richard J. "BCCI & Barings: Bank Resolutions Complicated by Fraud and Global Corporate Structure." in ''Systemic Financial Crises: Resolving Large Bank Insolvencies'' pp (2005): 321-345
online
* * * Körnert, Jan. "The Barings crises of 1890 and 1995: causes, courses, consequences and the danger of domino effects." ''Journal of International financial markets, institutions and money'' 13.3 (2003): 187-209. * * Mezrich, Ben (2004). ''Ugly Americans''. New York: HarperCollins. . * *


External links


The Baring Archive

"The Collapse of Barings Bank"


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The New York Times ''The New York Times'' (''the Times'', ''NYT'', or the Gray Lady) is a daily newspaper based in New York City with a worldwide readership reported in 2020 to comprise a declining 840,000 paid print subscribers, and a growing 6 million paid ...
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"Sir Miles Rivett-Carnac, Bt"
''Daily Telegraph'' obituary


Timeline of Barings bank


{{Authority control Defunct banks of the United Kingdom Banks established in 1762 Corporate scandals Rogue trading banks Crime in Singapore Former investment banks Economic history of Singapore Economic history of the United Kingdom ING Group Banks disestablished in 1995 Barings Bank 1762 establishments in Great Britain Bank failures Accounting scandals Banks of Devon British companies disestablished in 1995