the world of private banking

54
THE WORLD OF PRIVAtE BANKING
Private Country Banks
Moving from the capital to the regions is moving either to near-complete void or
to the realm of statistics. In some countries, such as Britain, private country banks
had all but disappeared by the last decade of the nineteenth century. In others, such
as the Mediterranean and the Scandinavian countries, provincial country banking
never really took off, the gap being filled by savings banks and other types of cooperative
and mutual banks. Provincial private banks survived at the very heart of
continental Europe, above all in France and Germany, where hundreds of small
and mostly anonymous banks remained part of the local economy until the First
World War.
The realm of statistics is, however, fraught with great uncertainty. Estimates of
the number of private banks vary within very broad bands and recent research has led
to drastic revisions. Take France, a country long seen as under-banked during most
of the nineteenth century. According to Rondo Cameron’s early estimates, there were
369 banks in France in 1870, totalling 469 outlets, compared with 1,628 outlets in
England and Wales. 43 Recent estimates by Alain Plessis based on the reports of the
branch inspectors of the Banque de France, show that there were no less than 2,000
bankers in France in 1870, possibly as many as 3,000, taking into account all types of
capitalists who carried out discount transactions. 44 These are of course estimates, but
there can be little doubt that banking was plentiful in provincial France in the last third
of the nineteenth century. Competition stiffened from the 1870s onwards, especially
as the big deposit banks (Crédit Lyonnais, Société Générale, Comptoir d’escompte)
started to build their networks of branches. However, local private bankers were far
from being wiped out. There were still thousands of local banks in France on the eve
of the First World War. Some estimates put their number at around 1,000 to 1,200
plus a good 1,200 escompteurs; 45 others go as high as 3,162, two thirds of them with
less than six employees. 46 One explanation for such resilience lies in the attitude of
the big banks. Even though they expanded by setting up networks of branches across
the country, they did not cover the entire territory and had but scant interest for local
business. The gap was filled by local private bankers, who concentrated on specific
tasks, especially agricultural credit and industrial finance. 47
43
R. Cameron, Banking in the Early Stages of Industrialization (Oxford, 1967).
44
A. Plessis, ‘Le “retard” français: la faute à la banque? Banques locales, succursales
de la Banque de France et financement de l’économie sous le Second Empire’, in P. Fridenson
and A. Straus (eds), Le capitalisme français, 19 e –20 e siècles: Blocages et dynamisme d’une
croissance (Paris, 1987).
45
A. Liesse, Evolution of Credit and Banking in France (Washington,1909), quoted
in S. Nishimura, ‘The French Provincial Banks, the Banque de France and Bill Finance,
1890–1913’, in Economic History Review, vol. 48, 3, 1995, p. 538.
46
F. Schaum, Das Französische Bankwesen (Stuttgart, 1931), quoted in M. Lévy-
Leboyer, ‘Préface’, Les banques en Europe de l’Ouest de 1920 à nos jours (Paris, 1995), p. V.
47
L. Bergeron, Les capitalistes en France (1780–1914) (Paris, 1978), pp. 109–10.