the world of private banking

270
THE WORLD OF PRIVAtE BANKING
Who sat in the parlours? The Banker in 1970 popped the question: ‘Mr
Hambro, you once spoke of “enlightened nepotism.” Do you believe that the old
banking families will continue to provide leadership as banks grow larger and
more complex than in the past?’ Jocelyn Hambro replied: ‘Some banking families
continue to produce hybrid vigour – others do not. There is competition within the
family; they undergo rigorous selection and training, and not all members make the
grade. But let us hope there will always be some that do’. 22 Through the 1970s and
into the 1980s, the Hambros, the Barings and the Rothschilds continued to make
that grade in their respective family banks, though in each case there was more
scope for non-family promotion than there had been in the past. Overall, there
was only patchy progress towards a non-Etonian meritocracy, with by the early
1980s that school still providing seven chairmen of the sixteen members of the
Accepting Houses Committee. 23 The case of Schroders is particularly interesting.
Back in 1957 it had brilliantly recruited Gordon Richardson, a thoroughgoing
middle-class meritocrat with an unglamorous provincial background who through
the 1960s gave the bank very professional leadership before in 1973 becoming
one of the Bank of England’s best governors this century. A clear guideline, one
might have thought, when in 1977 Schroders had to choose a new chairman. The
two candidates were the Earl of Airlie and James Wolfensohn, the former (to quote
the bank’s historian) an ‘“Establishment” figure’ who ‘personified integrity and
prudence, and stood for continuity’, the latter an Australian and a ‘multifariously
talented, intellectually brilliant internationalist’, in short ‘the embodiment of
dynamism’. Schroders – in the year of punk, of Thatcher poised for power, of the
City about to change for ever – plumped for the Scottish earl. 24
How rare was that failure to pick up on the Zeitgeist? In the 1960s, arguably,
the merchant banks had not done too badly, despite their relative lack of social
mobility and proletarian appeal. Big was beautiful, the merchant banking structure
itself was going through a fairly intense phase of rationalization, and houses like
Warburgs, Schroders and Hill Samuel were well plugged into one of the decade’s
defining economic themes, the restructuring of British industry. In 1965 that
invaluable guide to the Zeitgeist, Queen magazine, published its survey of English
society: who and what were in, who and what were out. Recommended City
jobs included a discount house, a jobbing firm, and a ‘partnership in a merchant
bank’; but to be a stockbroker or an underwriter at Lloyd’s was to risk being a
social outcast. Three merchant banks were listed as ‘in’ – Rothschilds, Lazards
and Warburgs – and three as ‘out’ – Morgan Grenfell, Kleinwort Benson and
Hill Samuel. 25 The 1970s were rather different. During the early, frenetic years,
culminating in the ill-fated Barber boom, there was a sense of the traditional City
(Oxford, 1989), chs 7 and 8; Roberts, Schroders, chs 13, 14 and 15.
22
Banker, Aug. 1970, p. 819.
23
A. Sampson, The Changing Anatomy of Britain (New York, 1982), p. 315.
24
Roberts, Schroders, p. 484.
25
J. Stevens (ed.), ‘The Sixties’, in Queen Magazine, 1987, p. 126.