grow year by year. Was not Holland the first country to create a system enabling banks to serve both trade and industry, with the establishment in Amsterdam in 1824 of the famous Société de la Maatshappij* with capital of 80 million, of which 10 million francs was personally subscribed by a king of the Netherlands?

Lastly, is not the Amsterdam market the only place in the world (even taking London into account) where all European and foreign State funds are officially listed on the Stock Exchange?

Not long afterwards, another chronicler warmly expressed the interest aroused by the founding of the Nederlandsche Credit- en Deposito Bank:

The country par excellence for accumulating capital and the traditional home of good finance, Holland has just joined the trend towards modern banking by setting up a financial institution which is surely destined to take a leading position among similar institutions in Europe.

*It was actually the Nederlandsche Handel-Maatschappij (NHM)

the placing of foreign debt was carried out by administrative offices which issued bearer- certificates, of which the underlying instrument was foreign debt. These certificates were in fact registered in the country of the debt issuer. It should be noted that this activity, which was the first kind of investment fund in the world, had already been in existence since the 1770s.

The renaissance of capital markets and the establishment of new banks, 1860-1914

The period 1860 to 1914, with acceleration after 1890, saw the formation of the modern Netherlands banking sector, which can rightly be termed a Netherlands financial empire. 3 as Johan de Vries notes. Economic progress during the 1860-1914 period fostered the rebuilding and development of capital markets, which saw strong growth both in the number of deals and the number of participating institutions. Advances against one- month renewable paper, together with three-month Lombard loans4 were a prominent feature of many of the deals.

Although the capital markets were very active during this period, the actual volume of investments remained lower than on other major European markets. During the 1910- 1915 period, total investment in foreign securities on the Dutch market amounted to 3 billion guilders (around $1.25 billion equivalent), at a time when investment in foreign securities stood at $19.5 billion in Great Britain, $8.6 billion in France and $6.7 billion in Germany. It was therefore difficult for the Dutch market to compete with these major markets, which led Dutch institutions to forge partnerships with other European banks. During this period issues of domestic debt increased, stimulated by a growing demand for capital.

It was against this background that a number of financial institutions and intermediaries were set up. The majority of players in the capital markets were involved both in market deals issues, new listings, and so on and commercial banking business. This was also the time when new players, such as the Nederlandsche Handel-Maatschappij (the Netherlands Trading Society) came into the market. From 1880 onwards NHM took part in issuance syndications, first of all in the Netherlands and its colonies, and then on the international markets.

The Dutch market was also influenced by the Crédit mobilier 5 movement in France; such banks had the declared objective of promoting industrial enterprises of all kinds, such as the construction of railways and the opening of mines, by making loans and dealing in

3. In Handbook on the History of European Banks, European Association for Banking History, Edward Elgar, 1994, p. 725.

4. A Lombard loan is one for which the borrower pledges as collateral assets that can be easily liquidated, usually a securities portfolio.

5. Société Générale de Crédit Mobilier was founded in 1852 by the brothers Isaac and Emile Pereire for the purpose of taking stakes in companies.

30 T H E H I S T O R Y O F B N P PA R I B A S I N T H E N E T H E R L A N D S