Which bank, which had opened in 1762 (and was the oldest merchant bank in London) collapsed in 1995 after one of the bank's employees lost 827 million ($1.3 billion) speculating primarily on futures contracts?
Barings Bank Barings Bank Barings Bank was a British merchant bank based in London, and the world's second oldest merchant bank (after Berenberg Bank). It was founded in 1762 and was owned by the German-originated Baring family of merchants and bankers. The bank collapsed in 1995 after suffering losses of £827 million ($1.3 billion) resulting from poor speculative investments, primarily in futures contracts, conducted by its employee Nick Leeson, working at its office in Singapore. Barings Bank was founded in 1762 as the John and Francis Baring Company by Francis Baring, with his older brother John Baring as a mostly silent partner.
Bad bank and about $130 million in Mellon capital; it was named for a main street in Pittsburgh which was home to Mellon Financial headquarters. It took no public deposits. Mellon shareholders were issued shares in both the good and bad banks on a one-for-one basis, as a dividend. After the Grant Street National Bank had fulfilled its purpose, issuing preferred shares and equity purchase contracts to finance the purchase of $1 billion in Mellon's bad loans at 57% of face value, then collecting what it could on the individual loans, it was liquidated and its employees quietly returned to Mellon Bank.