Nicholas W. Leeson, whose massive losses in futures trading are blamed for the downfall of British investment bank Barings, expressed remorse for his actions and told his employers that he was approaching a nervous breakdown, according to documents published Monday.
Meanwhile, the estimate of Barings' loss in the debacle has risen to $1.46 billion, almost 50% more than the $1 billion originally estimated, Barings lawyers said Monday. That loss widened when Japan's leading stock measure went down instead of up, against the bets of the 28-year-old trader.
The lawyers announced the higher losses in London's High Court, which later approved the takeover of Barings by the Dutch bank ING Group, saving the failed company's 4,000 jobs.
The Dutch group agreed to continue using the name Barings and pay bonuses to Barings employees. It hopes to resume business within days.
This came as the Business Times newspaper in Singapore published a handwritten fax in which Leeson expressed "sincere apologies for the predicament that I have left you in. It was neither my intention or aim for this to happen but the pressure, both business and personal, have become too much to bear and after receiving medical advice have affected my health to the extent that a breakdown is imminent."
Leeson then offered his immediate resignation.
Barings officials were not available to confirm the authenticity of the document.
Business Times said Leeson sent the fax from the Regent Hotel in Kuala Lumpur after fleeing Singapore last week. It was sent to Simon Jones and James Bax, two Singapore-based directors of the company.
Leeson is in jail in Frankfurt, awaiting the outcome of an extradition hearing on Singapore's charges that he committed fraud by forging a document. He was arrested as he arrived on a flight from Brunei on Thursday.
Leeson, who was general manager of Barings' futures trading operation in Singapore, is blamed for losses that caused the collapse of Britain's oldest merchant bank, one that numbered Queen Elizabeth II among its clients.
Leeson's wife told British newspapers on Sunday that the couple did not realize anything was amiss until they picked up a newspaper in east Malaysia over the weekend. She said they were taking a vacation to mark her husband's 28th birthday.
But there was evidence that the couple left Singapore in great haste last week, with laundry still flapping on the balcony of their condo.
Singapore financial officials presented evidence Saturday that contrary to prior evidence, senior officials of Barings in London had been aware for some time of the dangers of Barings' futures dealings there.
Lawyers given the responsibility for overseeing Barings' Singapore operations said the company's treasurer, Anthony Hawse, flew to Singapore on Feb. 8, more than two weeks before the bank's collapse, and assured authorities that the bank had sufficient resources available to cover its huge exposure in the futures market. The bank then sent its Singapore office nearly $1 billion to help pay for the investments and keep the company afloat.
Futures trading allows investors to profit from future movements in prices of securities, commodities or indexes. Leeson apparently bet heavily that the main Tokyo stock market index, known as the Nikkei-225, would rise, when it actually fell dramatically.
An internal Barings audit conducted in August, 1994, warned that the company was giving Leeson too much power by allowing him to be general manager of futures trading and, at the same time, head of the back office settlement division of the company. It warned that the combination of jobs in one executive opened the job to abuse.
Associated Press contributed to this report.