ABSTRACT
In contrast to many other chapters in this book, this essay steps aside from the behaviour and performance of banks at times of acute political and social stress. Instead, this chapter suggests ways in which bank archives can act as a window on outside events, with bankers observing and commenting on the world around them. Throughout banking history, information gathering has been a vital
ingredient of the profession and it has become an important but neglected part of the legacy of banking archives. The examples which follow are from the old Overseas Branch of Midland Bank, now HSBC Bank plc.1 The Overseas Branch generated a remarkable series of reports on conditions in Central and Eastern Europe in the 1920s and 1930s. The collection is emphatically a Western version, from the viewpoint of ‘the old, settled Europe’ in Conrad’s phrase. Yet this is one of the richest and most unusual seams of comment and analysis in the bank’s records, clearly demonstrating the banker’s instinct for accumulating intelligence about the societies where banks operated. To date, and even though the Group’s archivists have mentioned these records in their talks to historians, archivists and students since the late 1970s, Philip Cottrell is the only historian to have referred to the collection (Cottrell, with Stone, 1992, pp. 51, 74). Other multinational banks surely have similar examples of this information gathering and one of
the objectives of this chapter is to encourage further interest in these relatively under-used sources. The business context of these records is important to their historical
value. On the surface, the compilation of information about Central and Eastern Europe may appear to be an eccentric, wayward activity for a bank such as Midland. For much of the twentieth century, Midland was famous for its lack of involvement in overseas banking and its promise to ‘refrain from competing with our foreign friends in their own country’ (Holmes and Green, 1986, p. 165). In reality, however, Midland was not so distant from overseas banking. Behind the public stance, Midland had long experience and interest in the wider international picture. It was this legacy which was to sustain the gathering of intelligence by the Overseas Branch in the 1920s and 1930s. Under the leadership of Sir Edward Holden, the bank’s managing
director from 1898 to 1919 and chairman from 1908 to 1919, Midland had greatly expanded its role as a correspondent bank (particularly in partnerships with North American banks) and it had also been the first of the major British banks to intervene in foreign exchange business.2 Holden had also toyed with the idea of opening branches in New York and Chicago. Then in 1909 Midland came close to taking a one-third share in the Union Bank of Moscow. At that time Moscow and St Petersburg were the scene of intense competition for banking and loan business, with British and German financiers challenging the traditional supremacy of French banks in the Russian market. Holden’s play for the Union Bank eventually came to nought – partly as a result of the reluctance of the Russian chancellor and partly as a result of some alarming discoveries which Holden’s team came across in the Union Bank’s balance sheet – but the episode suggested close rather than distant interest in overseas opportunities. Holden and his colleagues did not give up their watch on Russia. In 1913,
they seconded Frederick Bunker, a member of the bank’s ‘foreign banks department’ to the Azov-Don Bank, St Petersburg. Bunker was appointed Midland’s representative in St Petersburg three years later and, in February 1917, a representative office was opened in the Moika. A less auspicious moment for a new venture in Russia could not be imagined. Nevertheless, throughout the two revolutions which followed, Bunker delivered a lively stream of business and information about the turmoil in the East. He remained in Petrograd after most Westerners (including the British Embassy staff) had left, until eventually in 1918 he was forced to escape through Red and White Russian lines to Finland and Sweden. ‘Actual banking business had come practically to a standstill and could only be done in fear and
trepidation,’ Bunker wrote to Holden in May 1918. ‘Holding on therefore meant only keeping up appearances for one never knew when one might be forcibly closed up.’3
