City Bankers, 1890–1914. By Youssef Cassis.
Cambridge: Cambridge University Press,
1994. Pp. xv+350. ISBN 0-521-44188-9. £40.00.
John Bullion's empire: Britain's gold problem and India
between the wars.
By G. Balachandran.
Richmond: Curzon Press, 1996. Pp. xii+252. ISBN 0-7007-0428-0. £40.00.
The banking panics of the Great Depression.
By Elmus Wicker. Cambridge: Cambridge
University Press, 1996. Pp. xviii+174. ISBN 0-521-56261-9. £30.00.
The front cover of Cassis's book shows the heavily bearded and
mustachioed directors
of the Bank of England, gathered in 1903 in the magnificent Court Room.
The City
was at its peak, the undisputed financial capital of the world. Its interests
were the major
determining influence on British economic policy. The Bank of England directors
were
selected, according to ancient tradition, from the City's most prestigious
trading houses,
including the merchant banks. Towards the end of the nineteenth century
it had
become obvious that banking was undergoing a radical transformation. A
revolution in
the structure of English banking had caused the near-disappearance of the
old country
banker; private family-owned banking firms were under severe pressure and
many had
been absorbed by the joint-stock banks. However, much had remained the
same. It is
one of the virtues of Cassis's book, which focuses on the top layer
of City bankers, that
it shows how much continuity there was. The old private banker fitted smoothly
into the
new, larger banks. The occupation of private banker, carried out within
a family firm,
continued to represent the ideal. Banking remained a not particularly onerous
job. The
typical City banker was a part-timer, who used his position and representation
on the
boards of other financial companies as a means of furthering his own business
interests
– he had to, because a board position alone did not pay enough to
live like a gentleman.
Banking was a respectable way of building up a fortune. The City's
strength was its
private information network of social and business relationships which
made the highly
specialized financial system possible but also created opportunities to
make money
privately. The author shows that the distribution of tasks within the City,
as well as the
reluctance of the big joint-stock banks to develop into continental-style
investment
banks, eminently suited the private interests of the board members, ‘as
though the
primary aim of the big deposit banks... was to make possible the activities
of the private
banking and trading firms and the overseas ventures of the partners of
these firms’.
What is now considered insider trading was an accepted form of business.
There were
few professional bank managers; those there were had generally risen through
the ranks
and had a lower social status. The City's playing field was never
intended to be level and
appears to have become even more slanted in the period before the First
World War.