Peregrine's last days, by Andre Lee

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Peregrine's last days, by Andre Lee

How did Asia's foremost investment bank come to grief? Andre Lee - seen by many as the villain of the piece - speaks out for the first time. He tells Peter Lee about the internal tensions at Peregrine, the role of his fixed-income business, the firm's culture of credit management and the source of the rumours that broke the bank

When Peregrine Investments Holdings collapsed in January, blame for the disaster was quickly pinned on the 34-year-old head of its fixed-income business, Andre Lee. Lee and a team of 14 from Lehman Brothers had arrived at Peregrine in 1994 with a reputation for being at the cutting edge of developments in Asian bond markets. He quickly built the largest fixed-income group in Asia, numbering some 220 at its height. While other leading investment banks sought to lead international issues for Asian governments and the region's largest companies, Lee dug into Asia more deeply, originating local capital-markets business for lesser-known Asian companies.

After Peregrine hit trouble late in 1997, it emerged that Peregrine Fixed Income had effectively lent $260 million - equivalent to a quarter of the firm's entire capital - to an ambitious Indonesian transport company, Steady Safe. Lee was quickly bracketed with Nick Leeson, the rogue trader who brought down Barings. Stories resurfaced that Lehman Brothers had discovered losses in its bond portfolios following Lee's departure in 1994.

Lee has not spoken publicly since the collapse of Peregrine. He agreed to give his version of events to Euromoney in late March.

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