Making a Melodrama out of a Crisis: Reinterpreting the Collapse of Barings Bank

Abstract

In February 1995 Britain's oldest merchant bank, Barings, was put into administration after a series of disastrous losses on trading complex financial instruments. In this paper it is argued that the collapse of Barings symbolises the profound transformation in the City of London and the international financial system since the 1960s. The author analyses the response to the collapse by Barings' senior management, the British regulatory authorities, and the British media, arguing that they all misinterpreted the nature of the crisis. It is argued that criticisms of the Bank of England's actions by sections of the media signify wider changes in British society.