City and
Salomon abdicates
private banking loses its most public :I. advocate as Sir Walter Salomon slips into the wings. He has ended 34 years as chairman of Rea Brothers, the City bank which,in its present form, is his creation. The smallest of the accepting houses, Rea Is on that score conventionally called a merchant bank. No, says Sir Walter, a private bank. It is true that for most of the time Rea keeps out of sight, occasionally looming here or there as the force behind some decisive shareholding. But the stan- dards of the private bankers are for Sir Walter a matter of public importance, and when commercial or central banks forget those standards, they bring many of our present woes upon us. What they lack, he says, is the private banker's discipline of risking his own money: 'With the decline of the impact of the owner-occupier, as far as the funds of the banks were concerned, ambitious people wanted to compete with other ambitious people.' As for the Bank of England and the central banks of other nations, they no longer even risked their shareholders' money. Long before the seeds of today's banking troubles were sown, Sir Walter was arguing, in the Spectator, for making the central banks independent of government, or for estab- lishing a new international central bank in the hands of the market. It worked (he told us last year) in 15th-century Genoa. The city state's creditors amalgamated to form the independent Banco di Giorgio, and took over the national debt. They did so well that the bank's power soon rivalled the state's. Our own city state of London, after years of secretly regarding Sir Walter as a vocal eccentric and more recent years of suspecting that he may have been right all the time, will miss those philippics, delivered in that unmistakable voice — not mittel-European, as he would point out, but a good North German accent, from Hamburg. Or have we heard the last? Sir Walter is retiring from Rea's chair and board, Sir Malcolm Wilcox of the Midland becomes chairman, Bill Dacombe comes across from the Royal Bank of Scotland f'11113oP as managing director. But it is not in e nature of the private banker to walk away.
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