the world of private banking

PRIVAtE BANKS AND INtERNAtIONAL FINANcE 155
agents might also be kept. By the end of the nineteenth century, this role had all
but disappeared, passing to the government’s home bankers which had, by then,
established reliable international connections.
From time to time, the role embraced particular commissions such as the
purchase or sale of commodities or equipment. During the American Civil War, for
example, Barings was charged by the United States government with purchasing
for its account munitions in Europe. More regular work involved the provision
of credits to captains of United States warships for use in purchasing supplies
when absent from home ports. Similar functions were undertaken for the Imperial
Russian Government, especially during the First World War when Barings assisted
the government in its fund-raising negotiations with the British government and
subsequently made payments for the purchase of war supplies. The volume of
this business was enormous, and a particularly large archive of correspondence,
telegrams and contracts accumulated. Throughout its history Barings received
numerous commissions from the British government despite no formal agency
existing. Most notably, these commissions included the remittance of funds to
Britain’s allies during the European Wars, 1793–1815, and the supply of grain to
Ireland during the Irish Famine in the late 1840s.
The management of financial agencies was discreet work which seldom came
to general notice, but it nevertheless created real conflicts of interest. On the eve
of the Crimean War, for example, when Britain and France confronted Russia, the
head of Barings was accused in the House of Commons of being a private agent
of the government of Russia on account of the government’s bullion supposedly
being removed from Barings’ vaults prior to the declaration of war. Of greater
historical note was the 1803–4 transaction whereby Barings, with Amsterdam
merchant bankers, marketed United States government bonds to finance that
government’s purchase of the Territory of Louisiana from France at a time of war
between France and Britain. In effect it amounted to financing an enemy of the
British Crown, and Barings was in due course obliged to curtail its role.
Comparatively little financial-agency correspondence survives in Barings’
archives, as presumably most of it was routine. By far the most important source,
however, is the ledgers and their supporting journals, which survive in their
entirety and quite clearly show the nature of the business undertaken. This aspect
of Barings’ work has scarcely been researched.
Private Banking Services
The provision of financial services to merchants, governments and big businesses
inevitably drew merchant banks into providing banking services to individuals
associated with them. These included current accounts, advances, safe custody,
security dealing, travel facilities and trustee services, but in terms of revenue
generated this was never of great significance at Barings, unlike at other merchant
banks where it was developed more purposefully. It did, however, notably add