MPs to debate report on Barings

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The Independent Online

MPs will be allowed to discuss a critical Bank of England report on the collapse of Barings bank within the next three weeks, it was confirmed yesterday.

Investigators at the Bank of England's board of banking supervision are expected to hand their long-awaited report to the Chancellor of the Exchequer, Kenneth Clarke, within the next 10 days.

The document will be published in time for it to be debated before the House of Commons breaks for the summer on 21 July. Agreement on the precise timetable and mechanism for any debate will be negotiated beween Conservative and Labour party managers in the House.

But Treasury sources said yesterday that no decision had yet been taken on whether the report on the pounds 800m crash of Britain's oldest merchant bank would be published in its entirety.

"Full publication is dependent on lots of issues. For example, it may be that for commercial or banking supervision reasons ... we would not be able to publish it uncensored, any more than it was possible with BCCI," a source said.

MPs on both sides of the House will want to know how it was possible for senior Barings management to allow pounds 800m to be transferred to Singapore to cover the losses run up by Nick Leeson, the trader at the centre of the affair.

Mr Leeson is in prison in Frankfurt, fighting extradition attempts by the Singapore authorities. He has said that he wants to be tried in Britain.

Barings was rescued by the Dutch banking group ING. More than 20 senior Barings executives have left the merchant bank since ING's takeover.

It is widely expected that the Bank of England report will savagely criticise a number of former senior Barings executives, including the former chairman, Peter Baring, and his deputy, Peter Tuckey.

Others likely to be in the firing line include Peter Norris, who was chief executive of Barings Investment Bank, and Ron Baker, formerly the London boss of Mr Leeson.

Members of the House will also want to see evidence that the Bank of England has investigated its own supervisory controls and whether there is a need for any changes in that area.

Originally, the report was to have been published in two parts: one looking at what went specifically wrong in the case of Barings; the other examining regulatory lessons and the Bank's own supervisory role.

Delays in the preparation of the Barings part of the report has meant that both will appear at the same time.

A Bank of England spokes-man said: "What we have always said is that we would be aiming to have our report ready for the Chancellor before Parliament's summer recess."