Nick Leeson (Barings Bank) Is Starting to Get Worried
Nick Leeson — the former rogue derivatives trader whose illicit trades sparked the collapse of 230-year-old Barings Bank and sent him to prison for four years
This month marks thirty years since Leeson had amassed trading losses of about $1.4 billion when working for Barings in Singapore in 1995, leading to the bank’s failure and eventual sale to ING Groep NV for just £1.
A film was made in 1999 based on his book about the scandal, starring Ewan McGregor.
“When I think back to my time at Barings, we had one compliance officer, and I think she was also the risk manager for 2,500 people,” he said.
“You walk into most offices now in Canary Wharf or around this area, and there’s 3,000 people working in compliance.
Leeson also acknowledged that, in some instances, the crackdown on banks in the aftermath of the 2008 global financial crisis might have gone too far,
such as some of the more onerous regulations included in the US’s Dodd-Frank Act, which overhauled banking oversight when it became law in 2010.
I tell my children, if they find themselves in a difficult situation, just come to me and tell me what’s going on. There might be a difficult period but I’ll help you through it.”
Bloomberg 21 februari 2025
- Jag återvände från Singapore 1999, ansvarig för de förluster på 862 miljoner pund som knäckte Storbritanniens äldsta investeringsbank, personligen dömd som ansvarig för 100 miljoner pund, och fick ändå inom loppet av en vecka erbjudande om fem olika kreditkort.
Nick Leeson, SvD Brännpunkt 21/9 2008
https://englundmacro.blogspot.com/2012/02/6000-how-much-original-rogue-trader.html
In 1872, when Phileas Fogg, Jules Verne’s enigmatic character, wagered with his whist partners at London’s Reform Club, including an assistant governor of the Bank of England,
to travel around the world in eighty days, he issued a cheque for £20,000, drawn on Baring Brothers.
That was sufficient, as his cheques were paid on sight, and he had joined the club on the recommendation of Baring Brothers, which had given him an unlimited overdraft facility.
https://englundmacro.blogspot.com/2023/03/the-collapse-of-svb-at-speed-not-seen.html
The main problem is that the Fed has not moved with alacrity to implement fully key provisions of the Dodd-Frank financial reforms, which were passed in 2010.
For example, the Dodd-Frank legislation specifies that all large financial institutions should draw up meaningful “living wills” – specifying how they could be allowed to fail, unencumbered by any kind of bailout, if they again became insolvent.
https://englundmacro.blogspot.com/2023/03/svb-backstop-revives-specter-of-moral.html
Next time there's a crisis, the big banks should be allowed to fail
Economists will no doubt be debating the effectiveness of QE for a couple of generations at least.
https://englundmacro.blogspot.com/2016/02/next-time-theres-crisis-big-banks.html
The Dodd-Frank financial law succeeded at making banks safer, but empowered shadowy corners of finance that nearly wrecked the system in March.
https://englundmacro.blogspot.com/2020/07/the-dodd-frank-financial-law-succeeded.html
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