BSI and Barings: Down and Out in Singapore

Stamford Raffles Statue, Singapore

Stamford Raffles Statue, Singapore

On January 17 1995 when the Kobe earthquake struck, over 6,000 people lost their lives. Later that morning in an office in Singapore a certain Nick Leeson felt a cold shiver run down his back.

The British banker Nick Leeson, then working for Barings bank in Singapore, had placed a short straddle on the Nikkei Index, guessing that the exchange would remain stable overnight, neither going up nor down by a significant margin, his punt as we know now, went very wrong.

Twenty years ago Barings was a reputable British institution. It claimed to be the City’s oldest merchant bank which had been trading continuously since 1762. It was also a banker to the Queen of England.

Brought The House Down

However the discovery of a surreptitious file, ironically named 88888 in Singapore, brought an end to all of that.

From his Singapore base Leeson had thrown away £827 million on behalf of Baring’s and as a result brought down the house that John and Francis Baring had built.

Malaysian Escape

When the «rogue trader» twigged that his covert dealings could no longer be secreted away, Leeson, together with his then wife fled Singapore for Malaysia, in an effort to flee Asia. Later they were arrested at the airport in Frankfurt.

This week in Singapore another Malaysian connection has led to one more old European bank collapsing. The tremor that brought down this bank did not register on the Richter scale, however the number one was prominent, as in 1MDB.

Deceit and Dishonesty

In 1873 in the picturesque lakeside city of Lugano in the canton of Ticino in Switzerland, Banca della Swizzera Italiana was born. That bank until very recently was more commonly known as BSI.

BSI, the bank that rattled the Monetary Authority of Singapore (MAS) so much that this week it said: «BSI Bank is the worst case of control lapses and gross misconduct that we have seen in the Singapore financial sector».

Like Barings before it, conscious dishonesty and willful deceit by Singapore based operatives led to the downfall of another venerable institution.

Unwanted Notoriety

As a result a Wealth Planner called Yeo Jiawei and his connections to the troubled Malaysian wealth fund, along with several others including the former Singapore branch head, Hanspeter Brunner, are now awaiting their collective fates. Their names too will now go down in folklore, forever affiliated with the aforementioned Leeson.

For some at BSI their futures might be saved by the ongoing EFG International acquisition.

A Second Career

As for Barings, it became part of ING, when the Dutch bank paid the sum of £1 for it in 1995. Many if not all of Leeson’s former colleagues lost their jobs.

Leeson himself spent four years in Changi prison before he was released because of his diagnosis of colon cancer and was then sent back to the U.K. Later he moved to Ireland, where he remarried and became the manager of Galway United for several years.

With the outbreak of the financial crisis he then started his second career as keynote speaker about risk and return in finance.

Compare my salary

Compare my salary

Feeling Underpaid? Benchmark your salary by job title, company and location. Find out where you stand in minutes.

compare my salary


Newsletter-SymbolFree Subscription

Subscribe to our free newsletter and receive daily email alerts from the finews editorial team with a list of the top featured articles.

Share with us

Do you have any market intelligence to share with – email us on – All communication is completely confidential and strictly anonymous.