Banking in the Netherlands in the nineteenth century

The development of crédit mobilier In the beginning of the nineteenth century, the banking sector in the Netherlands was characterized by a relatively simple structure. The Nederlandsche Bank was founded in 1814 by William I, King of the Netherlands. The bank had the exclusive right to issue banknotes in guilders and to grant credits in order to stimulate commerce and industry that had suffered badly under the Continental System. Gradually, the Nederlandsche Bank would develop into the central bank. Other banks were active in the international trade of commodities, credits and were well known for foreign sovereign debt issues. With the exception of the Nederlandsche Bank, credit business was really of a secondary importance. Credits were granted by way of discounting bills receivable, and by the pledging of securities, metals or agricultural commodities.

It was around 1855 that the Dutch started to orientate themselves on the creation of big joint stock banks14, new forms of credit and on the new phenomenon of the Crédit mobilier created in France by the Pereire brothers15. Numerous and lively debates among professionals took place. Among other considerations, the central bank thought the concept of Crédit mobilier, which combined universal banking and investment banking too speculative. It was no surprise that in 1856 a number of similar projects, which mainly came from abroad, were refused royal approval.

However, during the following years, the climate for new banks gradually improved. With the financial crisis of 1857, the speculative mood on the financial market had largely disappeared. This could be one of the explanations of the change in the attitude of the government, which started to see the need for a rapid economic recovery. The government was also aware of the more liberal ideas that were gaining ground and of the new developments abroad16.

This climate offered opportunities for new banking institutions. The new banks that wanted to adopt the statute of a limited company met with a more favourable attitude than before. Their objectives were no longer so strictly judged. Among these banks the statutes were approved in 1863 of the Rotterdamsche Bank N.V. and the Nederlandsch- Indische Handelsbank N.V. Another new banking institution was the NCDB, with Samuel Sarphati as the driving force.

14. Naamloze Vennootschap (N.V.).

15. Crédit mobilier was created in 1852 by the brothers Pereire and became, under their management, a powerful and dynamic bank. Following the example of the Société Générale de Belgique, the bank created by King William I of the Netherlands in 1822 in Brussels, this new institution made itself, both in France and abroad, a promoter of large enterprises of all kinds. It made up a veritable financial group with interests in mining, big credit institutions, insurance companies, building companies and utilities. In 1866/67, the Crédit mobilier was shaken by a severe crisis as it had tied up too much of its capital in loans to the Compagnie immobilière. The Pereires were forced to resign, and the bank went into decline.

16. J. Kymmell, Geschiedenis, volume 1; P.A. Geljon, Geschiedenis van de Algemene Banken in Nederland 1860-1914, volume III, p. 83-144.

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