the world of private banking
the world of private banking
the world of private banking
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56<br />
THE WORLD OF PRIVAtE BANKING<br />
universal <strong>banking</strong> system. 53 The great banks provided ‘development assistance to<br />
<strong>the</strong> strong’, but <strong>the</strong>y badly neglected small and medium-sized enterprises. 54 The<br />
latter, however, could turn to <strong>the</strong> regional joint-stock banks or to <strong>the</strong> local <strong>private</strong><br />
banks, depending on <strong>the</strong>ir size and needs.<br />
The Lasting Influence <strong>of</strong> Private Bankers<br />
One <strong>of</strong> <strong>the</strong> main contributions <strong>of</strong> <strong>private</strong> bankers in <strong>the</strong> second half <strong>of</strong> <strong>the</strong> nineteenth<br />
century was <strong>the</strong> establishment <strong>of</strong> <strong>the</strong> new joint-stock banks, which have dominated <strong>the</strong><br />
financial <strong>world</strong> ever since. 55 Such major banks as <strong>the</strong> Deutsche Bank, <strong>the</strong> Dresdner Bank<br />
and <strong>the</strong> Commerz-Bank in Germany, <strong>the</strong> Banque de Paris et des Pays-Bas (now part <strong>of</strong><br />
BNP Paribas) in France, <strong>the</strong> Banque de Bruxelles (now integrated into ING) in Belgium,<br />
<strong>the</strong> Swiss Bank Corporation (now part <strong>of</strong> UBS) in Switzerland, or <strong>the</strong> Credit-Anstalt (now<br />
part <strong>of</strong> Bank <strong>of</strong> Austria Creditanstalt, a subsidiary <strong>of</strong> UniCredit) in Austria − to give but a<br />
few well-known names − were all founded by <strong>private</strong> bankers in <strong>the</strong> third quarter <strong>of</strong> <strong>the</strong><br />
nineteenth century. 56 In Britain, by contrast, <strong>the</strong> initiative for <strong>the</strong> foundation <strong>of</strong> <strong>the</strong> new<br />
joint-stock banks in <strong>the</strong> 1830s and 1840s had come from merchants and industrialists<br />
ra<strong>the</strong>r than <strong>private</strong> bankers, who were at first antagonistic to <strong>the</strong> ‘new bank’. However,<br />
<strong>the</strong> difference between Britain and continental Europe should not be overstated. On <strong>the</strong><br />
one hand, <strong>private</strong> bankers were instrumental in <strong>the</strong> creation <strong>of</strong> several British overseas<br />
banks in <strong>the</strong> 1850s and 1860s. Glyn, Mills & Co., London’s largest <strong>private</strong> bank, was<br />
particularly active in <strong>the</strong> field with <strong>the</strong> promotion <strong>of</strong> six such banks, including <strong>the</strong> Bank<br />
<strong>of</strong> Australasia, <strong>the</strong> Imperial Ottoman Bank, <strong>the</strong> Anglo-Austrian Bank, and <strong>the</strong> London<br />
and Brazilian Bank. 57 On <strong>the</strong> o<strong>the</strong>r hand, <strong>the</strong> conversion <strong>of</strong> <strong>private</strong> banks into joint-stock<br />
banks led to <strong>the</strong> formation <strong>of</strong> several major clearing banks, Lloyds Bank and Barclays<br />
Bank being <strong>the</strong> most prominent among <strong>the</strong>m. 58<br />
53<br />
D.Ziegler, ‘Banking and <strong>the</strong> Rise and Expansion <strong>of</strong> Industrial Capitalism in<br />
Germany’, in A. Teichova, G. Kurgan-van Hentenryk and D. Ziegler (eds), Banking, Trade<br />
and Industry: Europe, America and Asia from <strong>the</strong> Thirteenth to <strong>the</strong> Twentieth Century<br />
(Cambridge, 1997), pp. 142–4.<br />
54<br />
R. Tilly, ‘German <strong>banking</strong>, 1850–1914: Development Assistance to <strong>the</strong> Strong’, in<br />
Journal <strong>of</strong> European Economic History, vol. 15, 1986, pp. 113–52.<br />
55<br />
The continuity between <strong>the</strong> ‘old’ and <strong>the</strong> ‘new’ bank was clearly established by<br />
David Landes some fifty years ago in his seminal article ‘Vieille banque et banque nouvelle:<br />
la révolution bancaire du XIX e siècle’, in Revue d’Histoire Moderne et Contemporaine, vol.<br />
3, 1956.<br />
56<br />
See L. Gall et al., The Deutsche Bank 1870–1975 (London, 1995); Bussière,<br />
Paribas; H. Bauer, Société de Banque Suisse, 1872–1972 (Basel, 1972).<br />
57<br />
P.L. Cottrell, ‘A Cluster <strong>of</strong> Corporate International Banks, 1855–75’, in Business<br />
History, vol. 33, 3, 1991.<br />
58<br />
See R.S. Sayers, Lloyds Bank in <strong>the</strong> History <strong>of</strong> English Banking (Oxford, 1957); M.<br />
Ackrill and L. Hannah, Barclays: <strong>the</strong> Business <strong>of</strong> Banking 1690–1996 (Cambridge, 2001).