IT ALWAYS seemed there had to be more to the collapse of Barings than meets the eye. That Britain's oldest merchant bank could not have been brought crashing down by the wayward actions of one 28-year-old trader, unless there was something badly wrong with Barings' internal monitoring mechanism. That when brokers across Asia knew the bank was heavily exposed to Nikkei futures contracts, Barings executives in London could have remained totally in the dark about the dangers they were facing.
Few could ever have imagined the scale of negligence, revealed at yesterday's extraordinary press conference by Singapore monetary authorities. Only a few days ago, the bank's chairman Peter Baring alleged that Nick Leeson had secretly conspired with an unknown partner so that the bank was left in the dark about his activities.
Now it has emerged that Barings' executives in London were warned three years ago about the dangers of concentrating too much power in Mr Leeson's hands. Only last month, group treasurer Anthony Hawes flew to Singapore to reassure worried regulators that the situation was under control.
That must raise serious doubts about the sincerity of Mr Baring's earlier statements. It will also leave many wondering what skeletons are still waiting to be uncovered.
Certainly it now seems clear that, if only through their negligence, Barings executives in London were at least as much to blame for the bank's collapse as Mr Leeson. Perhaps it is indicative of the all-too-common view in London that Asia is something of a wild east - where different rules apply from back home.
It is one thing to depend on regulators to scrutinise the financial and banking industries. But it is quite another, when individual companies fail to ensure they keep their own houses in order. And that must mean tighter management controls over staff, no matter how far from headquarters they may be working. Barings London obviously allowed its Singapore office to operate under different criteria to those at home.