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Nanjing University of Post and Telecommunication


									   Nanjing University of Post and Telecommunication


Unit level:           Unit no:         Date of issue:                       Lecturer:
   H2                       14          28/12/2009                       Donald Wang

              Unit Title:                               Submission Deadline:
 Working with and leading people                           1st submission

Assignment No:                   02

Title: The collapse of the Barings Bank

Barings Bank (1762 to 1995) was the oldest merchant bank in London until its collapse in
1995 due to serious misconduct of one of the bank's employees, Nick Leeson and his
unauthorized trading in derivatives.

The story of the Barings collapse is because the bank’s employee, Nick Leeson, also the
head of the derivatives trader of the bank, undertakes the unauthorized trading in its
branch located in Singapore, whose unauthorized trading caused tremendous losses of
£827 million ($1.3 billion). Because of the absence of oversight, Leeson was able to make
seemingly small gambles in the futures arbitrage market at Barings Futures Singapore and
cover for his shortfalls by reporting losses as gains to Barings in London.

Leeson’s case was not an isolated one as many China's state-owned corporations have
suffered billion dollars in losses related to commodity price or forex trading over the past
years, which include Air China, Shanghai Airlines and China Eastern Air (Jan. 2009),
Shenzhen-listed Nanshan Power, COSCO (Dec。2008), and CITIC Pacific (Oct. 2008) who
announced a loss up to $ 2 Billion due to finance executives made unauthorized trades on
the value of the Australian dollar and euro, and the celebrated case of Singapore’s China
Aviation Oil (CAO) resulted the company to become technically insolvent.

Write an investigation report from the viewpoints as a management specialist about this
type of monetary crisis as per the below tasks assigned to you.
Unit Outcomes and Assessment Criteria Covered:
     Outcome No(s)                                  Assessment Criteria
2. Understand how to        2.3 Clarify expectations of relationships
build winning teams         2.4 Encourage team members to develop roles during team assignment
                            2.5 Empower individual to develop their own ways of working
                                independently and to rely on their own capabilities within pre-set

4. Analyse the work and     4.1 Plan to analyze work activities using appropriate objective-setting
development needs of             techniques and processes
individuals considering     4.2 Negotiate assignments with colleagues using suitable delegation
performance monitoring           techniques to motivate and enable colleagues
and assessment              4.3 Review development needs and activities and evaluate the
                                 effectiveness of activities
                            4.4 Use suitable methods, with clearly defined and relevant criteria and
                                 objectives, to assess the performance of colleagues
                            4.5 Identify factors affecting the quality of performance and use these
                                 to provide clear and constructive feedbacks on performance to
                            4.6 Incorporate results of assessments into personal development plans
                                and other organizational procedures for dealing with performance

Assignment Tasks:                                                                      Assessment
You should prepare a report that covers the following tasks:
Task one:
Investigating into the situation and identify the root-causes of the problem of the
bank and providing the solutions to the problem from your own viewpoints。                 2.3
Task two:                                                                                 2.5
Providing your advice and suggestions about how the company is able to ensure
the effectiveness of the employee’s performance and how the misconduct of the
employees can be prevented before the serious damage of financial losses are              4.1/4.2
occurred.                                                                                 4.3/4.4
(To remind you: Your writing must cover all the assessment criteria as listed on
the right).
Grading Criteria
The assignment will be graded into Pass, Merit and Distinction against
the following criteria:

A pass grade is achieved by meeting all the requirements defined in the unit

In order to achieve a Merit grade, you should achieve all the above points and also:

M1: identify and apply strategies to find appropriate solutions
M2: select/design and apply appropriate methods/techniques
M3: Present and communicate appropriate findings

In order to achieve a Distinction grade, you should achieve all the above points and

D1: use critical reflection to evaluate own work and justify valid conclusions
D2: take responsibility for managing and organizing activities
D3: demonstrate convergent, lateral and creative thinking

 Guidelines for Presentation
 1. All assignments must be word-processed using Times New Roman (12 point) and stapled
    in the top left hand corner.
 2. Page numbers must be included at the bottom of each page.
 3. Secondary sources should be acknowledged using the Harvard referencing system:
 4. Students are requested to attach the ‘assessment activity front sheet’ on the top of each
    report with all personal information (name, and student number etc.) accurate presented.
 5. Every report must have a front page showing the title, class, name
 6. The length of writing will be limited to/ about 1500 words.
 Note: Assignment did not follow this ‘Guidelines for presentation’ will not be accepted.

Plagiarism is an academic offence! The contents of this assignment must be your own work.
Where you refer to ideas other than your own you must acknowledge this by appropriate
The Collapse of the Barings Bank



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