In: Accounting
Barings Bank collapsed about two decades ago as a result of derivative trading. Identify any other high profile corporate bankruptcy attributable to derivative trading and.
I.Describe the events that created the problem outlining the differences and similarities between Barings Bank and your chosen institution
II.What are the lessons that financial institutions, investors and regulators can learn from the occurrence of such events.
The high profile corporate bankruptcy attributable to derivative trading is of ENRON BANK.
(I) The events that created problems in Barings Bank and Enron Bank are:
(II) The lessons that financial institutions, investors and regulators can learn from the occurrence of such events is that not to belive the companies so much by its way of presenting itself. For that, every aspect related to the financial conditions of the company should be reviewed by the regulatory authorities. And the policies should be made by the government of the countries to maintain transparency and accountability to customers, employees and regulatory authorities. To maintain balance in financial market, information and disclosures should be collected wholly from the company to avoid any loopholes later.