the world of private banking

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THE WORLD OF PRIVAtE BANKING
Antoine Odier married the daughter of a businessman from Hamburg descended
from French reformed ancestors, then married his son, James, to the daughter of
an Amsterdam banker. The Hottinguers were allied to Farquhar Jameson, a British
associate of the house, with the Delesserts, whose bank they acquired, and with the
de Bethmanns, who also belonged to the world of international finance.
These foreign connections were reinforced further by travelling, which allowed
the same bankers to receive their parents and ‘friends’ from various countries and
in turn visit them. The members of these families moved around considerably,
at least as long as their age allowed them to. Generally, they sent their sons on
numerous foreign journeys which were really training to allow them to understand
major international business. Naturally, they often started in England, close
geographically and ahead in the development of credit. The majority visited this
destination, but there were also those who made multiple tours abroad, such as
Rodolphe Hottinguer, who left for England at the age of 18. After returning for
a year in Paris he then spent some time in St Petersburg, then left for the United
States, this already being a well-established tradition in the family: some years
later he left for a tour of the Ottoman Empire. Alphonse de Rothschild went to
London at a very early age and made frequent and prolonged stays, notably from
the age of 19, for experience of the railroad business. In 1848, at the age of 21, he
was ready to leave for the United States, exploring the business worlds of New
York, New Orleans, and, more briefly, Havana. In 1856, he visited the Ottoman
Empire, where his father had already travelled prior to 1848; he also went as far
as Alexandria in Egypt.
These journeys had the further objective of prospecting for new markets and,
above all, forming a good network of agents in order to develop these markets.
The power and prosperity of each house of the Haute Banque in effect depended
for its importance and effectiveness on its appointed (and often part-time) agents,
especially in foreign countries. Bertrand Gille has shown how the house of
Rothschild formed a particularly close network of agents, who could be private
bankers also working on their own account, in a large number of financial markets.
In the countries where Rothschild’s interests were particularly important, they set
up their own local agents, paid by the house, ‘who acted only on orders, or who
generally only acted in very restricted fields’.
In so building up their network, the Rothschilds were not really innovating,
but following a path forged by the Protestant bankers in the eighteenth century.
The inventories of Mallet Brothers and Co., which was not the most powerful
of the houses but held the honour of being the oldest, give a sufficiently precise
idea of the geographic distribution of its agents at the end of 1860. At that date
the bank listed 1035 holders of current accounts, as many debtors as creditors,
and close to 500 of these were for agents domiciled outside France: seventyfive
set up in England, as many again in the Scandinavian countries, about fifty
in the German States, about forty in Switzerland; about thirty of the accounts
came from Belgium and about twenty from Holland. The house had 35 regular
clients in Spain, similarly in Italy, around ten in Portugal and around another ten