“The story of the Chartered Bank is a story not so much of Silver Crises and Currency reforms as of men. We should not aim to produce a highly ornamental volume which will gather dust in bank bookcases, but a story which everyone interested in the British achievement in the East will read and re-read.”
Sadly, despite this signal of grand intent, the book contracted out to the celebrated Whisky Galore author Compton Mackenzie for the bank’s centenary in 1953 was a disappointment. It thus falls to Crossing Continents, Duncan Campbell-Smith’s sparkling new account of Standard Chartered Bank, to be the book that this bank’s extraordinary history deserves.
It is not a critique of British imperialism, but it is a door-stopping, desk-breaking heavyweight tome running to nearly 1,000 pages of patient text and brilliantly evocative photographs.
As the writer of an authorised history (more of that later), Campbell-Smith, a former banker and journalist, had access to Standard Chartered’s rich archive, and what emerges is work of painstaking scholarship. Multiple sources — there are 84 pages of chapter notes alone — are woven together into a compelling record of imperial and post-imperial banking, the white men responsible and the lives they led.
And what lives they were. The colourful stuff comes from the Victorian period. It was dangerous — “gory heads stuck on poles decorated the end of the short road where the bank was” — and few of the expatriate bankers escaped health problems “not unrelated in many cases to the less medicinal qualities of Scotch whisky”. It demanded commitment — marriage was forbidden for all those below the rank of accountant — but there were compensations. In Singapore, “[a] little fish, some curry and rice, and perhaps a couple of eggs, washed down with a tumbler or so of good claret, does not take long to get through and yet forms a very fair foundation on which to begin the labours of the day.” Anyone for a skinny latte and kale smoothie?
The Chartered Bank of India, Australia and China in effect rescued the Standard Bank of South Africa in 1969. How the separate banks got to this position is the meat of the story.
Both banks were mid-Victorian foundations with Scottish roots, managed by expatriates, staffed with local clerks and supervised by remote boards. Chartered looked east — it never did much in Australia — and from the early days of shipping the City of London’s gold and silver coin then to telegraphing foreign exchange and trade finance, became a linchpin of the empire’s commercial life across the whole of Asia. By the 1930s, with one notable exception, it was the largest of the City’s 20 or so overseas banks. The exception was its deadly rival HSBC.
Standard looked south and got lucky. Founded to finance a South African wool trade that never took off, it was transformed by the diamond and gold discoveries of British South Africa. But by the 1960s, political difficulties marginalised the South African business and banking globaliser Chase Manhattan came calling. The Bank of England made it clear that the Americans were unwelcome and Standard Chartered Bank was formed.
The story of the next 30 years is that of a merged company trying to find a new identity. Lacking a strong domestic retail base, there was a plethora of consultants’ reports and strategic initiatives at the expense of operational grip. An unsuccessful attempt to tilt the business towards the west was reversed in the closing decade of the 20th century in time to identify with fast-growing economies in Asia, and into the new century the business finally took off. Senior managers were recruited from outside, the empire staffing model was finally banished, wholesale banking was yanked into the modern age by the development of a capital markets business and consumer banking was transformed through the acquisition of branch networks in Asia.
The decision to avoid mature markets in the west paid off. Come the global financial crisis of 2008, Standard had minimal exposure to US subprime mortgages or eurozone sovereigns and was heavily weighted in south-east Asia, the only part of the world still going strong. It was investors’ delight in an otherwise pariah industry and in 2011, chief executive Peter Sands and his predecessor Mervyn Davies, who delivered the final glory years, were profiled in the Harvard Business Review as examples of “higher ambition leaders” who combined shareholder value with societal worth. Record results in August 2012 were further proof of the bank’s success and it seemed a good time to commission a new corporate history.
But by the time the book was ready to go in 2016, events had taken a turn for the worse. US fines and settlements relating to money-laundering and sanctions-breaking eventually totalled $2bn, growth in China and the rest of Asia slowed and there was a $1bn writedown on a Korean acquisition. Profits were wiped out, the share price tanked and compliance was given a long overdue overhaul. It is left to current chief executive Bill Winters, appointed in 2015, to pick up the pieces.
The fall from grace is not a particularly shocking story in the context of the industry, but as told here it bears the unmistakable whiff of authorised corporate history. It is the briefest chapter in this otherwise excellent book and perhaps shows that like banking itself, writing about it is easier when dealing with the past than the present.
Crossing Continents: A History of Standard Chartered Bank, by Duncan Campbell-Smith, Allen Lane, £40, 944 pages
Philip Augar is the author of several books on the City of London, including ‘The Bank That Lived a Little: Barclays in the Age of the Very Free Market’
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