Hostname: page-component-78c5997874-m6dg7 Total loading time: 0 Render date: 2024-11-02T20:13:28.345Z Has data issue: false hasContentIssue false
  • English
  • Français

From ‘Old Corruption’ to ‘New Probity’: the Bank of England and its directors in the Age of Reform

Published online by Cambridge University Press:  12 September 2008

Anthony Howe
Anthony Howe
Affiliation:
London School of Economics and Political Science
Get access Rights & Permissions [Opens in a new window]

Abstract

An abstract is not available for this content so a preview has been provided. Please use the Get access link above for information on how to access this content.
Image of the first page of this content. For PDF version, please use the ‘Save PDF’ preceeding this image.'
Type
Articles
Information
Financial History Review , Volume 1 , Issue 1 , April 1994 , pp. 23 - 41
Copyright
Copyright © European Association for Banking and Financial History 1994

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

1 Wade, J., The Extraordinary Black Book (London, 1835 edn), p. 428.Google Scholar

2 For the origins of this perspective, Dickson, P. M. G., The Financial Revolution in England, 1688–1756 (London, 1967)Google Scholar; for the Radical exposition, Wade, , Black Book, pp. 428–51Google Scholar; Cobbett, W., Paper against Gold (London, 1817, 1828)Google Scholar; Marx perpetuated this tradition, with the Bank as the first sign of bourgeois power in Britain; e.g. Surveys from Exile, ed. Fernbach, D. (Harmondsworth, 1972), p. 251.Google Scholar Hence in Britain, financial preceded industrial capitalism.

3 Jones, G. Stedman, ‘The language of Chartism’, in Epstein, J. and Thompson, D. (eds), The Chartist Experience (London, 1982), pp. 20–1, 28Google Scholar; idem, Languages of Class: Studies in English Working-Class History, 1832–1982 (London, 1983), pp. 121–2.Google Scholar

4 (London, 1873).

5 e.g. Roberts, J., The Cormorant of Threadneedle Street (London, 1875).Google Scholar Roberts was associated with the ‘National Revivers’, a protectionist body, in the 1860s.

6 Inter alia, Clapham, J., The Bank of England, 2 vols (Cambridge, 1944)Google Scholar; Morgan, E. V., The Theory and Practice of Central Banking (London, 1943)Google Scholar; Fetter, F. W., The Development of British Monetary Orthodoxy, 1797–1875 (Cambridge, Mass., 1965).Google Scholar

7 Wade's, term; Black Book, p. 443.Google Scholar

8 For the Edwardian period, Cassis, Y. carefully analyses the Bank's directors as part of the broader City banking community in Les Banquiers de la City à l'époque edouardienne (1890–1914) (Geneva, 1984).Google Scholar

9 The wider aspects of this question are explored in Rubinstein, W. D., ‘The end of “Old Corruption” in Britain, 1780–1860’, Past & Present, 101 (1983), pp. 55–86.CrossRefGoogle Scholar The transition within the Church of England is vividly illuminated in Dewey, C., The Passing of Barchester (London, 1991).Google Scholar

10 Acres, W. M., The Bank of England from Within, 2 vols (Oxford, 1931)Google Scholar, provides a list of directors. Biographical information has been drawn from the archives of the Bank of England and the usual sources trawled by the prosopographer.

11 For a defence of this procedure by one of the directors, see Hankey, T., The Principles of Banking, its Utility and Economy; With Remarks on the Working and Management of the Bank of England (London, 1867 edn), p. 120.Google Scholar Directors were elected for three years at a time, but were eligible for re-election after a year out of the Court; once they had served as Governor they became permanent directors. Normally, 6 out of 24 directors ‘retired’ each year.

12 Clapham, , Bank, vol. II, p. 419Google Scholar; Cassis, , Banquiers, p. 112.Google Scholar For a typical view of the nineteenth- century Bank, Checkland, S. G., The Rise of Industrial Society in England, 1815–1885 (London, 1964), p. 209Google Scholar; for the view of the Bank as the nodal point of a financial elite, Lisle-Williams, M., ‘Beyond the market: the survival of family capitalism in the English merchant banks’, and ‘Merchant banking dynasties in the English class structure: ownership, solidarity and kinship in the City of London, 1850–1960’, British Journal of Sociology, 35 (1984), pp. 241–71, 332–62CrossRefGoogle Scholar; cf. Chapman, S. D., ‘Aristocracy and meritocracy in merchant banking’, British Journal of Sociology, 37 (1986), pp. 182–93CrossRefGoogle Scholar, who plays down the importance of the Bank, esp. p. 187.

13 Disraeli, , quoted in Checkland, Industrial Society, p. 209Google Scholar; Roberts, , Cormorant, p. 38.Google Scholar

14 Lombard Street, p. 174.Google Scholar

15 Morning Herald, 25 02 1836Google Scholar; see below for the 1840s.

16 Cassis, , Banquiers, p. 109.Google Scholar

17 Chapman, , ‘Aristocracy and meritocracy’, p. 184.Google Scholar

18 Dickson, P. G. M., The Sun Insurance Office, 1710–1960 (London, 1960), pp. 281–2.Google Scholar

19 Green, H. and Wigram, R., Chronicles of Blackwall Yard (London, 1881)Google Scholar; Public Record Office, Board of Trade Papers, 31/2822/15484, Money Wigram & Sons Ltd, shipowners.

20 J. R. Reid, East and West India merchant, was also a partner in the Ancoats Twist Mill (Manchester): see Fitton, R. S., Richard Arkwright, Prince of Cotton Spinners (Manchester, 1989), p. 158.Google Scholar

21 Harris, J. R., The Copper King (Liverpool, 1964), pp. xvi, 154–7.Google Scholar

22 Evans, D. M., The Commercial Crisis, 1847–48 (London, 1849, repr. 1969), pp. 70–1,78, Appendix, p. xxvii.Google Scholar

23 Bank of England, London, Archive [henceforth BoE], Court of Directors’ minutes, G4/71, 22 Feb. 1849; Phillips, M., The Copper Industry in the Port Talbot District (Neath, 1935).Google Scholar The Bank sold the Company in 1852. For a detailed account, see Roberts, R. O., ‘The Bank of England, the Company of Copper Miners, and the Cwmavon Works, 1847–52’, Welsh History Review, 4 (1968–1969), pp. 219–34.Google Scholar

24 Gale, W. K. V., Soho Foundry (W. & T. Avery Ltd, Birmingham, 1946), p. 27.Google Scholar Blake had joined the merchant house of Thomson Hankey, a Bank director, on leaving Cambridge in 1837, ‘to acquire business habits’. He then travelled in America, debt-collecting on behalf of the Bank, in 1838–9 before joining Watts in 1841: Proceedings of the Institution of Civil Engineers, 138 (1898–1899), pt IV, pp. 488–9Google Scholar; Proceedings of the Institute of Mechanical Engineers (1899), pp. 467–70.Google Scholar

25 Sims shot himself in 1839, the inquest hearing that ‘[he] had too many irons in the fire, what with the Bank of England and other companies’: The Times, 18 11 1839Google Scholar; The Birth of the Great Western Railway. Extracts from the Diary and Correspondence of George Henry Gibbs, ed. Simmons, J. (Bath, 1971)Google Scholar; Parliamentary Papers, 1845, XL (317); 1846, XXXVIII (473)Google Scholar; Railway Subscription Contracts.

26 Wade, , Black Book, p. 429Google Scholar; Crawshay, William, The Times, 7 12 1848Google Scholar. For the contrary modern view, see, for example, Ziegler, D., Central Bank, Peripheral Industry: The Bank of England in the Provinces, 1826–1913 (Leicester, 1990).Google Scholar

27 Wade, , Black Book, p. 451.Google Scholar

28 Thus, Baring, Tom: ‘would anybody tell him that the Bank of England had much more business to transact than the India House?’, Hansard, 3rd Ser., CXXVIII, c. 1457, 8 07 1853.Google Scholar

29 Centre for Kentish Studies, Maidstone, Norman Papers, U310/F69, Norman, G. W., MS ‘Autobiography’ (c.1857), f.478Google Scholar, for criticism of Palmer's handling of this crisis; BoE, Court minutes, 13 Apr. 1849, sets the original debt at £2,446,000, of which £1,986,532 had been received, £205,168 written off and £254,300 was outstanding.

30 Centre for Kentish Studies, Maidstone, Collet Papers, C87, M. Collet to J. C. Brown, 23 Dec. 1884.

31 Chapman, S. D., The Rise of Merchant Banking (1984), p. 178.Google Scholar

32 Dewey, , Passing of Barchester, pp. 126–7.Google Scholar

33 BoE, 82/47, List of Court directors proposed.

34 BoE, Dobree Papers, Diary, 1858.

35 Norman, ‘Autobiography’, fos. 290–5.

36 BoE, Dobree Papers, Diary, 8 Jan. 1858.

37 e.g. Richard Mee Raikes, bankrupt when Governor in 1834, was the son of Thomas Raikes, Governor 1797–9.

38 Cassis, , Banquiers, pp. 111–12Google Scholar; Lisle-Williams, , ‘Beyond the market’ and ‘Merchant banking dynasties’, passim.Google Scholar

39 Daunton, M. J., “‘Gentlemanly Capitalism” and British industry 1820–1914’, Past & Present, 122 (1989), p. 146.CrossRefGoogle Scholar

40 Plessis, A., Régents et Gouvemeurs de la Banque de France sous le Second Empire (Geneva, 1985), ch. I.Google Scholar

41 Lombard Street, p. 210.Google Scholar

42 Robinson, W., SirReid, J. R., Gower, A. L., Little, W. and Powell, D. respectively. As G. W. Norman noted, ‘the failure of a 2nd governor in office within a dozen years must be considered a great misfortune to the institution and will give a handle to enemies and promote much hostile observation.’ To Sir Charles Wood, 23 08 1847; Borthwick Institute, York, Halifax Papers, A4/129.Google Scholar

43 BoE, G8/34, Committee of Treasury, 29 12 1847Google Scholar; see too Sayers, R. S., The Bank of England, 1891–1944, 3 vols (Cambridge, 1976), vol. III, pp. 1–2Google Scholar; Halifax Papers, Norman to Wood, 1847 passim.

44 BoE, Court of Directors minutes, 20 01 1848, 3 and 10 02 1848Google Scholar. G. W. Norman was the only director who declined to become Governor, on grounds of health, yet remained a director and member of the Committee of Treasury.

45 BoE, General Court Book, 8, 16 03 1848Google Scholar; G15/131, copy of minutes of directors, 10 02 1848.Google Scholar

46 Lombard Street, p. 174.Google Scholar

47 Lisle-Williams, , ‘Merchant banking dynasties’, pp. 255ff.Google Scholar; cf. Chapman, , ‘Aristocracy and meritocracy’, pp. 185ff.Google Scholar

48 Halifax Papers, A4/129, Norman to Wood, 23 08 1847Google Scholar: ‘nothing in this sad event … can lower his moral character. His official duties have kept him from his counting–house in critical times and his partners have speculated imprudently….’.

49 Norman, , ‘Autobiography’, fos. 290ff.Google Scholar

50 Bodleian Library, Oxford, Acland Papers, d.181, f.80, Cotton, W. to his son, Cotton, W. C. (n.d., c.? 1846).Google Scholar

51 Bodleian Library, Oxford, Harcourt Papers, dep. 180, Welby to Harcourt, , 1 01 1894.Google Scholar

52 Lombard Street, p. 73.Google Scholar

53 Probate values offer a precarious estimate of wealth but provide a valuable, if rough, measure of comparison between groups over time. For the pitfalls, see Rubinstein, W. D. and Daunton, M., ‘“Gentlemanly Capitalism” and British industry, 1820–1914’ (debate), Past & Present, 132 (1991), pp. 150–89.CrossRefGoogle Scholar

54 Rubinstein, W. D., Men of Property (London, 1981), passimGoogle Scholar; Cassis, , Banquiers, p. 238.Google Scholar Only 29% of Bank directors 1890–1914 left £100,000 and under, compared with 59% of those studied here.

55 Plessis, , Régents, p. 75.Google Scholar

56 Cain, P. J. and Hopkins, A. G., ‘Gentlemanly Capitalism and British overseas expansion i: the Old Colonial System, 1688–1850’, Economic History Review, 2nd ser., 39 (1986), pp. 501–25CrossRefGoogle Scholar; ‘ii: New Imperialism, 1850–1945’, ibid., 40 (1987), pp. 1–26; Cain, P. J. and Hopkins, A. G., British Imperialism: Innovation and Expansion (London, 1993).Google Scholar See too Daunton, , ‘“Gentlemanly Capitalism”’.Google Scholar

57 Banquiers, p. 125.Google Scholar

58 Banquiers, pp. 126–9.Google Scholar

59 Norman placed the highest value on cricket: ‘It possesses the inestimable advantage of bringing together and with a common object men of the most different classes and then breaking up those distinctions of rank, wealth, and status which are the bane of English society’: ‘Autobiography’, f. 498. See too Norman, P., The History of West Kent Cricket Club (London, 1897).Google Scholar

60 Warner, P. F., Lord's, 1787–1945 (London, 1946), pp. 21, 23.Google Scholar

61 ‘Autobiography’, esp, fos.297–303; O'Brien, D. P. (ed,), The Correspondence of Lord Overstone, 3 vols (Cambridge, 1971)Google Scholar. Norman was Overstone's chief correspondent. Norman wrote a number of economic pamphlets of lesser distinction but of some influence, for example on the Whig Chancellor, Sir Charles Wood.

62 Collet was thus at pains to disavow Grenfell's views, fearing their impact in the United States. Collet to Brown, J. C. (New York), 24 09 1886, Collet Papers, C87.Google Scholar

63 Bateman, J., The Great Landowners of Great Britain and Ireland (1883 edn, repr. Leicester, 1971).Google Scholar

64 Collet estimated his losses at £16,213 for the years 1891/2–1897/98: Collet Papers, U1287/E19.

65 Girouard, M., The Victorian Country-House (London, 1979), pp. 11, 302, 393, 396, 419, 421, 436.Google Scholar

66 Acland Papers, d. 180, W. to Cotton, W. C., 29 01 1833.Google Scholar

67 Cassis, , Banquiers, ch. 6Google Scholar; idem, ‘Bankers in English society in the late nineteenth century’, Economic History Review, 38 (1985), pp. 217–24.Google Scholar

68 Cassis, , ‘Bankers in English society’Google Scholar, highlights the aristocratic connections of the Grenfell sons. Interestingly, C. P. Grenfell's brothers-in-law included J. A. Warre, the son of a Bank director, J. A. Froude and Charles Kingsley.

69 Caine, B., Destined to be Wives: The Sisters of Beatrice Webb (Oxford, 1986), p. 54.Google Scholar

70 Howe, A., The Cotton Masters, 1830–60 (Oxford, 1984), p. 95.Google Scholar

71 Clapham, , Bank, vol. II, p. 181.Google Scholar

72 For example, in 1859 C. P. Grenfell was well placed to secure the renewal of the Preston Borough Bank's loan of £155,225: Dobree Papers, Diary, 30 June 1859. For Grenfell's public face, see Taylor, H. A., ‘Politics in famine-stricken Preston: an examination of Liberal party management, 1861–65’, Historic Society of Lancashire and Cheshire, Transactions, 107 (1955), pp. 121–40.Google Scholar

73 cf.12.8 for cotton masters: Howe, , Cotton Masters, p. 97.Google Scholar

74 Bank directors may therefore differ from bankers as a whole, whom Cassis sees becoming MPs primarily for reasons of social prestige: Cassis, , ‘Bankers’, 227 and n. 46.Google Scholar

75 Hansard, 3rd ser., XX, c.296, 2 08 1833.Google Scholar

76 Bank service was seen as valuable preparation for government by the Economist, 20 01 1866, pp. 61–2.Google Scholar

77 Public Record Office, Foreign Office Papers, 918/73, Hankey to Odo Russell, 1866–83.

78 Turner, B. B., Chronicles of the Bank of England (London, 1897), pp. 230–2.Google Scholar

79 For this view, see, inter alia, Ingham, G., Capitalism Divided? The City and Industry in British Social Development (London, 1984), esp. pp. 130, 186, 192.CrossRefGoogle Scholar Ingham's account argues, rightly I think, that Gladstonian policy aimed to separate the Bank from the state; yet his emphasis is upon the ‘unintended consequences’ of this policy, the creation of a new ‘Bank, Treasury, City’ nexus of interdependence whose impact on policy became clear only in the interwar years.

80 For the ‘sulphur question’ involving Hubbard, see Escott, T. H. S., City Characters under Several Reigns (London, 1922), pp. 118–19Google Scholar, and Acton, H., The Last Bourbons of Naples (London, 1961), pp. 113–37Google Scholar; Bourne, K., Palmerston: The Early Years, 1784–1841 (London, 1982), pp. 586–9.Google Scholar

81 BoE, Dobree Papers, Diary, interview with the Chancellor of the Exchequer, 23 Apr. 1858.

82 Lombard Street, p. 92.Google Scholar

83 BoE, Dobree Papers, Grenfell to Dobree, 25 Aug. [1860]. For another director, Neave, Gladstone was ‘a veritable skinflint’: Neave to Dobree, 5 Feb. [1861].

84 BoE, Dobree Papers, Hubbard to Dobree, 30 Dec. 1860. Hubbard had frequently crossed swords with Gladstone when Governor of the Bank, 1853–5, thus marring a friendship based on religious affinity: British Library, London, Gladstone Papers, Add. MS. 44095, Gladstone–Hubbard letters.

85 Hansard, 3rd ser. CLVI, 1818–22, 22 02 1860.Google Scholar

86 Gladstone Papers, Add. MS. 44393, f-325, Hankey to Gladstone, 10 Mar. 1860.

87 Hilton, A. J. B., The Age of Atonement: The Influence of Evangelicalism on Social and Economic Thought, 1785–1865 (Oxford, 1989).Google Scholar

88 Harcourt Papers, dep. 180, Harcourt to Governor of the Bank (Powell), 8 Jan. 1894.