the world of private banking
the world of private banking
the world of private banking
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134<br />
THE WORLD OF PRIVAtE BANKING<br />
and Britain was in deficit. This allowed <strong>the</strong> Paris market and banks which were<br />
established <strong>the</strong>re to play a privileged role in <strong>the</strong> negotiation <strong>of</strong> bills <strong>of</strong> exchange.<br />
There remains little more to say. In credit deals and financial operations <strong>the</strong><br />
Mallets were at least as much, and undoubtedly more, involved with French than<br />
with foreign business during this period. At this time <strong>the</strong> monetary requirements<br />
<strong>of</strong> <strong>the</strong> French State were high, and those <strong>of</strong> some large French businesses (notably<br />
<strong>the</strong> major railway companies) remained considerable. This relative preference for<br />
French business by Mallet appears, in so far as it is possible to generalize, to have<br />
typified all <strong>of</strong> <strong>the</strong> houses <strong>of</strong> <strong>the</strong> Haute Banque during this period. There were<br />
without doubt houses which devoted <strong>the</strong>mselves more to international trade, such<br />
as de Neuflize (with acceptances representing 45 per cent <strong>of</strong> liabilities around<br />
1860-5), or Hottinguer, who became involved under <strong>the</strong> Second Empire with<br />
Crédit Foncier d’Autriche, with various metallurgical and mining businesses in<br />
Spain, with Russian railways and a number <strong>of</strong> miscellaneous securities in North<br />
America. Rothschild de Paris did better as always; having an unequalled network<br />
<strong>of</strong> agents, it was deeply integrated into <strong>the</strong> international economy. They were also<br />
to be found in all <strong>the</strong> major financial deals <strong>of</strong> <strong>the</strong> period concerning <strong>the</strong> loans<br />
<strong>of</strong> numerous States, <strong>the</strong> launch <strong>of</strong> new railway companies, and in international<br />
trade in tobacco, cotton, gold and already petroleum. They also had a very strong<br />
position in <strong>the</strong> exchange market, and in <strong>the</strong>ir portfolio <strong>of</strong> bills <strong>of</strong> exchange,<br />
which was worth a very considerable amount, foreign paper must have largely<br />
predominated.<br />
At <strong>the</strong> opposite extreme, many houses <strong>of</strong> <strong>the</strong> Haute Banque found <strong>the</strong>mselves<br />
less involved with <strong>the</strong> international economy, particularly among those which<br />
belonged to Catholic families, generally <strong>of</strong> French origin. Even if <strong>the</strong>ir various<br />
activities are badly understood, it seems correct to say that all were engaged in<br />
<strong>the</strong> negotiation <strong>of</strong> bills <strong>of</strong> exchange and involved in major deals, in particular on<br />
<strong>the</strong> Havre market. Firms such as Pillet-Will or Périer had less numerous and more<br />
dispersed foreign agents, and <strong>the</strong>y apparently only selectively participated in large<br />
foreign deals. For example Périer was very involved with <strong>the</strong> sugar-refining industry<br />
and coal extraction in France (<strong>the</strong>y maintained close links with <strong>the</strong> coalmining<br />
company at Anzin), having hardly any major liabilities beyond <strong>the</strong> national border<br />
except with <strong>the</strong> Belgian company, de la Vieille Montagne. The case <strong>of</strong> Seillière<br />
is not very different: certainly, following in <strong>the</strong> steps <strong>of</strong> Crédit Mobilier, it was<br />
involved a little in <strong>the</strong> Imperial Ottoman Bank and in Crédit Mobilier Spain. They<br />
also opened on <strong>the</strong>ir own account a Californian branch, entrusted to a certain Abel<br />
Guy up until 1870, and in this <strong>the</strong>y regularly invested between 2 and 4 million<br />
francs. The rest <strong>of</strong> <strong>the</strong>ir balance sheet, which rose to around 32 million from 1858,<br />
consisted mainly <strong>of</strong> <strong>the</strong> supply <strong>of</strong> wood and clothing to <strong>the</strong> French army and major<br />
participation in French businesses (in Etablissements Schneider at Le Creusot,<br />
wool mills) and in French railway companies: even if <strong>the</strong>y ‘did not limit <strong>the</strong>ir<br />
<br />
M. Lévy-Leboyer, ‘Le crédit et la monnaie’, in Histoire économique et sociale de la<br />
France, vol. 3, 1789–années 1880 (Paris, 1976), pp. 347ff.