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Witness Seminar on the Origins and Early Development of the Eurobond Market

Published online by Cambridge University Press:  22 February 2010

Kathleen Burk
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Abstract

This is the transcript of an oral history seminar in which those involved in the early years of the market during the late 1960s described and analysed their experiences. The session began with a short historical overview.

Ce texte est la transcription d'un document d'histoire orale. Les protagonistes des débuts du marché des eurobonds, à la fin des années soixante, y discutent et analysent leurs expériences. E introduction au séminaire, Kathleen Burk présenta un bref aperçu historique de la question.

Es liegt ein Protokoll eines Geschichtsseminars, wobei die Leute, die sich an den Frühjahren des Marktes Ende der sechsziger Jahre beteiligten, ihre Erfahrungen beschreiben und analysieren. Die Sitzung wurde mit einem kurzem historischem Überblick eingefürt.

Type
Articles
Information
Contemporary European History , Volume 1 , Issue 1 , March 1992 , pp. 65 - 87
Copyright
Copyright © Cambridge University Press 1992

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References

1 The first transfer by the Soviet Union of a dollar account to a European bank was to the Banque Commerciale pour l'Europe du Nord, whose telegraphic address was Eurobank. This was the first instance in which ‘euro’ was used in a financial market, and soon thereafter a dollar deposit held outside the US became known as a eurodollar deposit.

2 Strange, Susan, International Monetary Relations (Royal Institute of International Affairs, 1976), p. 181.Google Scholar

3 See, for example, Kerr, Ian, A History of the Eurobond Market: The First 21 Years (London: Euromoney, 1984), p. 18.Google Scholar

4 Hayes, Samuel L. III and Hubbard, Philip M., Investment Banking: A Tale of Three Cities (Boston: Harvard Business School Press, 1990), p. 29.Google Scholar

5 Von Clemm to Burk, Nov. 1990. In the early years of the Eurobond market, according to Kerr, White Weld ‘had probably the greatest Eurobond distribution capability of any single house at this time.’ History, p. 21.

6 Strange, International Monetary Relations, p. 180.

7 It has been estimated that the Eurodollar market grew from $1,500 million at the end of 1959 to over $50,000 million in 1970. A. Dequae, ‘Report on the Eurodollar Market for the Council of Europe’, Document 2939, 28 April 1971.

8 Kerr, History, p. 17.

9 Ibid.

10 Attali, Jacques, A Man of Importance: Sir Siegmund Warburg 1902–82 (London: Weidenfeld & Nicolson, 1986), pp. 223–4.Google Scholar

11 Kerr, History, p. 11.

12 Attali, Siegmund Warburg, p. 224.

13 This is ironic, since one of the attractions of the Eurobond became the speed with which they could be organised and issued. Ferrier Charlton ascribes this to S. 423(2) of the Companies Act 1948, which determined that the offer of securities of a foreign company is not caught by UK prospectus rules as long as the offer is made to those whose ordinary business it is to buy or sell shares or debentures, either as principal or agent. In view of the identity of the chairman of this seminar, it is interesting to note that this dates back to amendments proposed at the last moment to what became the Companies Act 1929 by the then MP for the City of London, Mr E. C. Grenfell. Mr Charlton believes that Grenfell's intervention was made for the following reason: ‘The Bill was debated in 1928, a period of boom in the New York market. I believe that, only at the last moment, UK brokers & jobbers saw themselves excluded from that market if US distributors had to file prospectuses. They wouldn't have bothered, of course.’ Ferrier Charlton to Peter Catterall, 26 Oct. 1990, with accompanying document.

14 Kerr, History, p. 14.

15 Attali, Siegmund Warburg, p. 225.

16 Von Clemm to Burk, Nov. 1990.

17 Kerr, History, p. 14.

18 Von Clemm to Burk, Nov. 1990.

19 Kerr, History, p. 20.

20 Interview with Dr Michael von Clemm, 8 June 1990.

21 Kerr, History, pp. 22–9.

22 Ibid., pp. 30–1, 50–1.

23 Interview with von Clemm, 8 June 1990.

24 Kerr, History, p. 29.