the world of private banking
the world of private banking
the world of private banking
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GERmAN PRIVAtE BANKS AND GERmAN INDUStRy, 1830–1938 167<br />
Schaaffhausenscher Bankverein, <strong>the</strong> first Prussian joint-stock credit bank, was<br />
founded in 1848 on <strong>the</strong> wrecked <strong>private</strong> bank Abraham Schaaffhausen, formerly<br />
<strong>the</strong> leading bank in Cologne. Like <strong>the</strong> Oppenheims, Schaaffhausen had begun to<br />
finance Rhenish industry during <strong>the</strong> 1830s, at first by short-term loans to textile<br />
firms, but later also by long-term loans to shipping and railway companies,<br />
insurances and coalmines. As outlined above, <strong>the</strong>se activities involved substantial<br />
risks, but Schaaffhausen was not as fortunate as Oppenheim ten years earlier and<br />
had to suspend payments during <strong>the</strong> revolutionary weeks in March 1848. Luckily,<br />
<strong>the</strong> revolution had brought liberal Rhenish railway entrepreneurs to power in<br />
Berlin, who temporarily lifted <strong>the</strong> ban on joint-stock credit bank concessions and<br />
approved <strong>the</strong> establishment <strong>of</strong> Schaaffhausenscher Bankverein by converting <strong>the</strong><br />
bank’s debts into stock. The continuity between <strong>the</strong> former <strong>private</strong> bank and <strong>the</strong><br />
new joint-stock bank was striking. Despite <strong>the</strong> bank’s failure <strong>the</strong> former partners,<br />
Victor Wendelstadt and Wilhelm Deichmann, kept <strong>the</strong>ir positions and were elected<br />
members <strong>of</strong> <strong>the</strong> executive board <strong>of</strong> <strong>the</strong> bank. 26<br />
By this time a joint-stock bank was no ‘managerial enterprise’ in a modern<br />
sense, but ra<strong>the</strong>r an enlarged <strong>private</strong> bank. The head <strong>of</strong> <strong>the</strong> bank as a particular<br />
person was at least as important for <strong>the</strong> bank’s success as <strong>the</strong> enlarged resources.<br />
Not surprisingly <strong>the</strong>refore, o<strong>the</strong>r joint-stock banks that were erected upon failed<br />
<strong>private</strong> banks also resorted to former partners, as in <strong>the</strong> case <strong>of</strong> Gustav Adolf<br />
Fischer, partner in <strong>the</strong> failed Barmen <strong>private</strong> bank Gebr. Fischer. He became a<br />
member <strong>of</strong> <strong>the</strong> executive board when <strong>the</strong> Barmer Bankverein Hinsberg, Fischer &<br />
Co. was founded on <strong>the</strong> remnants <strong>of</strong> <strong>the</strong> liquidated <strong>private</strong> bank in 1867. 27<br />
It cannot be denied that <strong>the</strong> French Crédit Mobilier was seen as a model for <strong>the</strong><br />
German credit banks founded in succession to <strong>the</strong> Schaaffhausenscher Bankverein,<br />
but it is also true that <strong>the</strong> mixed-<strong>banking</strong> experience gained by several <strong>private</strong><br />
bankers proved to be <strong>the</strong> decisive factor for <strong>the</strong> nascent universal banks’ success. 28<br />
Thus, almost all successful joint-stock banks were founded by experienced <strong>private</strong><br />
bankers:<br />
– Darmstädter Bank (by <strong>the</strong> Cologne banker Sal. Oppenheim jr. & Cie. and<br />
by <strong>the</strong> Frankfurt bankers Gebr. Bethmann and Goll & Söhne),<br />
– Berliner Handelsgesellschaft (by <strong>the</strong> most important Berlin bankers<br />
including S. Bleichröder, Mendelssohn & Co., Breest & Gelpcke and<br />
Robert Warschauer, but also by Oppenheim again),<br />
– Mitteldeutsche Kreditbank (by a group <strong>of</strong> less important Frankfurt<br />
bankers consisting <strong>of</strong> R. Sulzbach, J.J. Weiller Söhne, S.M. Schwarzschild<br />
and <strong>the</strong> Leipzig banker Becker & Co.),<br />
26<br />
Tilly, Financial Institutions, p. 112; Brophy, Capitalism, p. 91.<br />
27<br />
Hundert Jahre Commerzbank, 1870–1970 (Frankfurt/Main, 1970), pp. 109ff.<br />
28<br />
R. Tilly, ‘German Banking, 1850–1914: Development Assistance for <strong>the</strong> Strong’,<br />
in Journal <strong>of</strong> European Economic History, vol. 15, 1986, pp. 113–52, here p. 118.