The collapse of Barings Bank and Nick Leeson’s role in it is one of the most spectacular debacles in financial history. Two decades on, Mr Leeson continues to use his experiences to deliver a cautionary tale on the environment that led to the downfall of the bank, as well as his personal views on the current state of the economy and finance industry, and insights on risk management, company culture and mental well-being.
He started his career in the mid-1980s, as a clerk with royal bank Coutts, followed by a string of positions with other banks, ending up at Barings where he was promoted to the trading floor. He was subsequently appointed manager of a new operation in futures markets on the Singapore Monetary Exchange (SIMEX) betting on the direction of the Nikkei Index.
When Mr Leeson soon began to mount losses he requested extra funds to continue trading, which based on his previous high performance returns, were granted. Unfortunately the losses piled up, and within a few months Barings had lost US$1.3 billion, bringing down the 233 year old investment bank. Mr Leeson was held responsible and spent four years in a Singapore prison, where his wife divorced him, he developed cancer of the colon, and contemplated suicide.