The collapse of Barings Bank in 1890 prompted a rescue organized by the Bank of England.
Barings faced failure after its agent in Argentina, Edward J. N. Lucas, made large and risky investments in Argentine securities. Political and economic turmoil in Argentina caused those assets to lose value, leaving Barings unable to meet its obligations.
The Bank of England formed a rescue fund with contributions from commercial banks. The support prevented a disorderly collapse and helped contain the wider Panic of 1890, which had spread through London’s financial system. Barings was later reconstructed, while the old partnership was liquidated.
The episode illustrates how international capital flows could transmit crises in the nineteenth century. It also predates the modern idea of a central-bank lender of last resort in its present form. Barings survived as a banking institution after the rescue, but it ultimately collapsed in 1995 because of unauthorized trading by Nick Leeson.