barings history.pdf

8/14/2019 Barings History.pdf

1/25


2/25

London Bus by permission of Londons Transport Museum; all other images are from The Baring Archives.

Baring Asset Management Limited December 2011.


3/25

BaBaBaBaBa ri nri nri nri nri ngggggs ts ts ts ts trrrrraces itaces itaces itaces itaces its oris oris oris oris origggggins to 17ins to 17ins to 17ins to 17ins to 1762 w62 w62 w62 w62 whehehehehe n it wn it wn it wn it wn it wasasasasas

es tes tes tes tes tababababab lished in Llished in Llished in Llished in Llished in L ooooond ond ond ond ond on as a f n as a f n as a f n as a f n as a f irm oirm oirm oirm oirm of mef mef mef mef me rrrrrch ach ach ach ach a n tn tn tn tn ts as as as as andndndndnd

mememememe rrrrrch ach ach ach ach ant bnt bnt bnt bnt baaaaa nknknknknk eeeeerrrrrs - ts - ts - ts - ts - the fhe fhe fhe fhe faaaaa mimimimimily haly haly haly haly havi nvi nvi nvi nvi ng fg fg fg fg formeormeormeormeormerrrrrly bly bly bly bly beeeeeeeeee nnnnn

mememememe rrrrrch ach ach ach ach antntntntnt s in Es in Es in Es in Es in Exxxxxet eet eet eet eet errrrr. I. I. I. I. In tn tn tn tn the yhe yhe yhe yhe yeaeaeaeaea rrrrrs fs fs fs fs fooooollllllllll owinowinowinowinowing, tg, tg, tg, tg, the fhe fhe fhe fhe fir mir mir mir mir m

dominated tdominated tdominated tdominated tdominated the Lhe Lhe Lhe Lhe Looooond ond ond ond ond on cn cn cn cn caaaaapi tpi tpi tpi tpi tal maal maal maal maal marrrrrkkkkket to tet to tet to tet to tet to the ehe ehe ehe ehe exxxxxtetetetete ntntntntnt

ttttthat that that that that the fhe fhe fhe fhe fiririririrst ministest ministest ministest ministest minister or or or or of F rf F rf F rf F rf F raaaaance, tnce, tnce, tnce, tnce, the Duhe Duhe Duhe Duhe Duc de Rc de Rc de Rc de Rc de Richeicheicheicheicheli eli eli eli eli euuuuu,,,,,

fffffaaaaa mously cmously cmously cmously cmously cal lal lal lal lal led i t oed it oed i t oed it oed it onnnnn e oe oe oe oe of tf tf tf tf the six g he six g he six g he six g he six g rrrrreat poweat poweat poweat poweat poweeeee rrrrrs ins ins ins ins in

EEEEEuuuuurrrrrope, alope, alope, alope, alope, alooooonnnnng wi tg wi tg wi tg wi tg wi th Brith Brith Brith Brith Britai nai nai nai nai n, Fr, Fr, Fr, Fr, Fraaaaance, Rusnce, Rusnce, Rusnce, Rusnce, Russi asi asi asi asi a, P, P, P, P, Prrrrrususususus si asi asi asi asi a

aaaaand And And And And Aus tus tus tus tus tri ari ari ari ari a. T. T. T. T. The fhe fhe fhe fhe firm coirm coirm coirm coirm continntinntinntinntinued as a Lued as a Lued as a Lued as a Lued as a Looooond ond ond ond ond on ln ln ln ln leadeeadeeadeeadeeaderrrrr

i n m ei n m ei n m ei n m ei n m e rrrrrc h ac h ac h ac h ac h a n t bn t bn t bn t bn t baaaaa n k i nn k i nn k i nn k i nn k i ng ag ag ag ag a n d a sn d a sn d a sn d a s s e t m as e t m as e t m as e t m as e t m a n a gn agn a gn agn a geeeee m em em em em e n tn tn tn tn t

ttttthrhrhrhrhrououououougho ugho ugho ugho ugho ut tt tt tt tt the 20he 20he 20he 20he 20ttttthhhhhc ecececece ntntntntnt uuuuurrrrryyyyy.....

Barings initially traded nationally and

internationally in commodities ranging from woollen cloth

and timber to spices and silks, and provided agency and

banking services to other merchants. In the eighteenth

century its national network of merchant clients extended

as far as Exeter and Bristol in the West, and Newcastle,

Leeds and Manchester in the North.

But almost from the day of its f ormation, Barings

also built links with merchants in all the major ce ntres in

Western and Southern Europe, and by around 1800 had

extended its client base to bo th North and South America,

and to India and China.

During the years of the Napoleonic Wars, from

1793 to 1815, Barings began issuing securities. It became a

major financial contractor to the British Government,

initially financing its war effort and went on to act as

bankers and bond issuers in London for numerous

govern ments . The p roceed s of th ese iss ues we re oft en use d

for the de velo pment of infras truc tu re for citie s aroun d

the world.

In 1803 Barings undertook a transaction of the

utmost magnitude and importance in financing the

Louisiana Purchase, in which the United States doubled

its size by purchasing over one million square miles of

territory from France.

Early connections were established with

pionee ring railway compan ies throughout the world and

Barings was responsible for financing the construction of

the earliest railways in the USA, Canada, Russia, France,

China, Argentina, Chile and elsewhere.

At this time the fir m als o de velo ped a priv ate

banking business especially for individuals associated

with its existing client base. These included kings, prime

ministers, authors and even fictional characters such as

Phileas Fogg!

While it strengthened links with businesses at home

in the UK and Ireland, for example advising on the flota-

tion of Arthur Guinness in Dublin, in the 20 th century

Barings continued to act as a major financier of

international trade and issuer of sovereign and co rporate

debt and equity. The bank also financed the Imperial

Russian Governments war needs during the First World

War and advised on the reconstruction of the British

manufacturing industry in the 1920s and 30s.

In the 1950s, asset management developed as an

integral part of investment banking in the UK a nd Barings

was amongst the first to realise the potential and set up

an Investment Department in 1955. Early clients were

drawn from its corporate and sovereign connections but

pe nsi on f un ds an d cha rit abl e in sti tu tio ns we re so on

added. In the 1970s the international dimension was

extended with t he establishment of offices in the Far East,

North America and Europe.

In 1989, all of Barings asset management

activities were consolidated within Baring Asset

Management based at 155 Bishopsgate in the City

of London.


4/25


5/25

Front cover (left to right):

Sir Francis and John Baring and Charles Wall1804, by Sir Thomas Lawrence

This portrait shows the partners at the height of Barings power.

The letter held by Sir Francis and the ledger both carry the

name of Hope & Co., leading Dutch merchants at a time when

Amsterdam dominated the international capital market. Barings

greatly benefited from this connection in its early years and

the relationship continued until well into the 20thcentury.


6/25

Baring Asset Management a History


7/25

Sir Francis BaringFrancis Baring (1740-1810) established Barings in 1762 withhis brothers John and Charles. He led the business until 1804,

with Barings emerging as London's pre-eminent merchant bank

by 1800. He advised prime ministers, was appointed Chairman

of the East India Company and was knighted in 1793. On his

death he was described as "unquestionably the first merchant

in Europe; first in knowledge and talents, first in character

and opulence".

by Sir Thomas Lawrence


8/25

Alexander Baring,1st Lord Ashburton

Alexander Baring (1774-1848) succeeded his father, Sir Francis,

as senior partner. He was Barings' first resident representative

in America and played a key role in the Louisiana purchase.

Throughout the Napoleonic Wars he raised finance for Britain

and its allies, and led the financial operations which paid the

French reparations. In 1818, the Duke of Wellington commended

Alexander, saying that he had "to a certain degree the command

of the money market of the world". He was created Lord

Ashburton in 1835.

by Sir Thomas Lawrence


9/25

Commodity TradingOn formation, Barings derived its profit from buying and sellingcommodities internationally. It soon diversified into providing

services to other merchants including arranging insurance and

warehousing, and trading in commodities. This led to the

provision of banking services - such as making and collecting

payments, and providing loans and guarantees - the earliest

examples of merchant banking.

The Royal Exchange, City of London, c. 1762


10/25

The Louisiana PurchaseIn 1803, needing to raise funds for its war effort in Europe,France sold the 1,000,000 square mile Territory of Louisianato the USA for US$15 million. Barings and Hope & Co. financed

the sale, raising capital through the issue of 6% US government

bonds in London and Amsterdam. The acquisition doubled the

size of the USA in 1804, and 13 states were formed in whole or

in part out of the Territory. To this day it remains the greatest

real estate transaction in history.

Late 18th century map of the Louisiana Territory by John Senex and

(below) the extent of the territory on a modern map of America


11/25

Sovereign ClientsInitially Barings restricted its securities business to the issueof British or allied government bonds to finance war

expenditure. After 1815 this became immensely important

business when Barings sovereign clients included the

governments of the USA, Canada, Russia, Argentina, Chile,

China, Austria and Italy. The proceeds were used for general

government expenditure, the construction of transport

infrastructure and the building of cities.

A tombola used for selecting Buenos Aires 1824 bonds for redemption


12/25

Financing RailwayConstruction

In the early 19thcentury, rapidly expanding railways around the

world required immense funding which emerging economies

borrowed from the European capital markets. Under Thomas

Baring (1799-1873), the company specialised in issuing railway

company bonds in London, financing some of the world's

earliest railways. In 1853, according to one US railroad manager,

there was only one man to guide action in important

financial matters. Ask about anything and the reply is What

does Mr Thomas Baring say or think?

An illustration of transport infrastructure taken from a share certificateissued in March 1895 by the Chicago Railway Terminal Elevator Company.

(Below) a token belonging to Thomas Baring giving him free travel on theGrande Societe des Chemin de Fer Russes. Barings partners sometimesbecame non-executive directors of the railway companies it financed and

as such received free travel facilities.


13/25


14/25


15/25

Centre Spread:

Articles of PartnershipJohn and Francis Baring & Co. was established on ChristmasDay 1762, opened for business on New Years Day 1763 with a

capital of 4,200 and showed first year profits of 423. It

acted as London agents to the Baring family's much larger

textile business in Exeter. Over the next 250 years, Barings

became a leader in the London financial market and is now one

of the longest-established financial services companies in the

world.


16/25

MerchantShipping

Throughout its first 100 years, Barings owned and managed

merchant ships. In the 1870s its fleet comprised three tea

clippers - the Norman Court, the Black Prince and the Chaa

Sze. These were amongst the finest of their kind, with the

Norman Court being a sister ship of the Cutty Sark. The clippers

took cargoes of manufactured goods to the Far East and

Australia and returned to London with cargoes of tea.

Bills of Lading of the Norman Court, a sister ship of the Cutty Sark (1872), and(below) the route of its eighth voyage (1877-79)


17/25

Building of CitiesIn the late 19thcentury, the worldwide emergence and growthof cities meant that the construction of public buildings and

infrastructure such as transport facilities, water supply and

drainage, required financing. Barings clients included many

cities such as Boston, Buenos Aires, Constantinople,

Montevideo, Montreal, Moscow and Tokyo, issuing government

bonds and on-lending the proceeds to municipalities, which

gradually began borrowing directly from the market.

Coupons for municipal bonds payable at Barings


18/25

Private ClientsBarings provided international travellers with letters of creditenabling them to draw funds from the firms excellent networkof correspondent banks. In the 19thcentury, travelling clients

included Nathaniel Hawthorn, Henry Longfellow and

Washington Irving, as well as the fictional Count of Monte

Cristo and Phileas Fogg. Others, notably Napoleon III, James

Monroe, the Prince de Talleyrand, and the King of the Belgians

were associated with the firms sovereign clients.

(Clockwise from top left) Napoleon III, a cartoon appearing in Vanity Fair in 1869;the Prince deTalleyrand, 1835; a plate from Around the World in 80 Days;

Nathanial Hawthorn, 1850; a promisory note signed by James Monroe.


19/25

UK Corporate FinanceIn the late 19thcentury, Barings began undertaking corporatefinance work within the UK and Ireland. In 1886, they advised

on the flotation of Arthur Guinness Son & Co. of Dublin, then

the world's largest brewing business. The flotation of

Whitbreads followed shortly afterwards. Barings also issued

debentures to finance the construction of the Manchester Ship

Canal and the docks at Liverpool, as well as the introduction

of modern buses to London.

The opening of the Manchester Ship Canal by Queen Victoria in 1894 and (below) an RT bus - the

first modern model to be introduced to London.


20/25

In the 1920s and 1930s, Barings concentrated on the finance

of British industry and infrastructure. The company financed

the extension of existing underground lines into the suburbs

and the rebuilding of busy central London stations for the

Underground Electric Railway Companies of London Ltd. It also

advised on the restructuring and rationalisation of industry -

notably on the consolidation of much of the Lancashire cotton

textile industry into the Lancashire Cotton Corporation Ltd.

FinancingBritish Industry

1930 - Map of Extensions to the London Underground, which

along with a reconstruction project, was financed by Barings


21/25

Investment ServicesBy the 1950s, Barings had for some time provided security

management services and given informal investment advice,

especially to private clients. In 1955, this work was reorganised

through the creation of an Investment Department which grew

rapidly, acquiring new clients and developing a global network

of offices. In 1973 the Hong Kong office opened, followed by an

American office in Boston six years later, to help clients invest

in the rapidly emerging markets.

Baring International Investment Management Limited was established in Hong Kong in 1976


22/25

1989 to present dayAfter three decades of rapid growth, Barings consolidated allinvestment management activities within a new holdingcompany, Baring Asset Management Limited, and moved to

new premises on Bishopsgate in the City of London.

Today, Baring Asset Management is an international investment

management firm with offices, clients and business lines

spanning the worlds major markets. Barings provide investment

management services in developed and emerging equity and

bond markets, and hold a Queens Award for Enterprise 2010 in

the International Trade category the UKs most prestigious

award for business performance.

Since the foundation of Barings in 1762, the common thread

linking the past to the present has been an ability to help clients

benefit from changes in the markets through innovation. This

tradition continues today as Baring Asset Management invests

across global markets, seeking out attractive new areas of

investment on behalf of clients.

The current view from Baring Asset Managements building on

Bishopsgate, London. It overlooks Devonshire Square (at the bottom

left-hand side of the picture), the site of the original offices (inset).


23/25

Head OfficeBaring Asset Management, 155 Bishopsgate, London EC2M 3XY,

Tel: +44 (0)20 7628 6000, Fax: +44 (0)20 7628 7928,

www.barings.com


24/25

For lack of space the following family partners are not included in the family tree:

CCCCCharles Bharles Bharles Bharles Bharles Barararararing Ying Ying Ying Ying Yoooooung (1801 - 82),ung (1801 - 82),ung (1801 - 82),ung (1801 - 82),ung (1801 - 82),grandson of CCCCCharles Bharles Bharles Bharles Bharles Barararararing (17ing (17ing (17ing (17ing (17444442 - 1829)2 - 1829)2 - 1829)2 - 1829)2 - 1829)by his daughter Emily

EEEEEvvvvvelelelelelyyyyyn Bingham Bn Bingham Bn Bingham Bn Bingham Bn Bingham Bararararar ing (1893 - 1966)ing (1893 - 1966)ing (1893 - 1966)ing (1893 - 1966)ing (1893 - 1966), great grandson of WWWWWililililil llllliam Biam Biam Biam Biam Bararararar ing (17ing (17ing (17ing (17ing (1779 - 18279 - 18279 - 18279 - 18279 - 1820)0)0)0)0) , fourth son of SiSiSiSiSi r Fr Fr Fr Fr Francis Brancis Brancis Brancis Brancis Bararararar in gin gin gin gin g

George Rowland

(1918-91)3rd Earl of

Cromer

issue

Thomas (1733-58) Sir Francis (1740-1810)Charles (1742-1829)

2 sons 7 daus.

Cecil

(1864-1934)3rd Baron Revelstoke

Windham

(1880-1922)Evelyn

(1903-73)

1st Baron

Howick

John Baring of Exeter

(1697-1748)

John (1730-1816)2 sons 4 daus.

Elizabeth (1744-1809)1 son

Sir Thomas (1772-1848)Alexander (1774-1848)

1st Baron Ashburton

Henry (1776-1848)1st Marriage

3 sons 2 daus.

2 sons 5 daus.

Francis (1800-68)

3rd Baron Ashburton

3 sons 5 daus.

Alexander

(1835-89)4th Baron Ashburton

1 son 1 dau.

Francis

(1866-1938)

5th Baron Ashburton

4 sons 2 daus

Alexander

(1898-1991)

6th Baron Ashburton

4 daus.

Francis (1796-1866)

1st Baron Northbrook

Thomas

(1799-1873)

John

(1801-88)

Charles

(1807-79)

1st marriage

5 daus.

2nd marriage

1 son 1 dau. 1 son 2 daus.Thomas

(1831-91)

2nd marriage

Francis

(1850-1915)

1 son, 1 dau.

Thomas (1826-1904)1st Earl of Northbrook

issue

2nd marriage

Edward (1828-97)

1st Baron Revelstoke

Thomas (1839-1923)

2 sons

Evelyn (1841-1917)1st Earl of Cromer

1st marriage

4 sons, 1 dau.William (1799-1864)

2nd Baron Ashburton1st marriage

1 son2nd marriage

1 dau.

1st Marriage

John

(1863-1929)2nd BaronRevelstoke

Everard

(1865-1932)

Maurice

(1874-1945)

Hugo

(1876-1949)

2 sons 3 daus. Rowland

(1877-1953)2nd Earl of

Cromer

2nd

Marriage

issue issue

issue issueFrancis

(1909-40)

Sir Edward Reid

(1901-72)

issue issue

John

(b. 1928)

7th Baron Ashburton

Peter

(b. 1935)

Nicholas

(b. 1934)

Charles

(b. 1937)2nd Baron

Howick

issueissue


25/25

barings history.pdf

Documents