Inquiry team to meet

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The Independent Online

Business Editor

The nine person team charged by the Chancellor with investigating the Barings collapse is about to hold its first meeting, and is expected to set out three main lines of inquiry, according to Bank of England officials.

It will investigate the way Barings' subsidiaries in Singapore were managed from the group's London head office.

It will seek to establish the role played by the Singapore International Monetary Exchange, where Mr Leeson worked.

And it will want to find out the details of what happened in Singapore, where Mr Leeson was able to build up massive futures positions.

Although the team has not formally begun its inquiries into the case yet, the Bank denied that this meant work had not begun. Three Bank investigators went to Singapore and Osaka last weekend, while in London banking supervision officials and members of its special investigations unit are preparing the groundwork.

The unit was set up on the recommendation of Lord Justice Bingham's report on the BCCI scandal.The team in charge of the inquiry is the existing Board of Banking Supervision, established as a result of the Johnson Matthey Bankers' collapse in 1984. It is to direct investigations and write the report on Barings, but will not do all the detailed inquiries. The first meeting is expected today or tomorrow.

Three Bank officials including the governor and deputy governor are on the board as ex-officio members. Outsiders include Sir Dennis Weatherstone, chairman until the end of 1994 of JP Morgan, one of the largest derivatives traders.

Sir Dennis, an Englishman who rose to the top of New York banking, has been a leading campaigner for tighter control of derivatives by banks, and is a firm believer in self regulation.

JP Morgan has published details of its own control systems to raise awareness of what is needed among less experienced banks in the derivatives markets.

Sir Peter Leslie, a six-year veteran on the board, is a former deputy chairman of both Midland and Barclays banks, after being chief general manager of Barclays.

Lord Swaythling has been on the board for five years and is also chairman of Rothmans International, the tobacco group. He is a former banker at Rothschild and Samuel Montagu.

The other independent members are Jon Foulds, chairman of Halifax Building Society, Sir Alan Hardcastle, Peter Gerrard and Harry Taylor.