Anglo-Austrian Bank
From its creation until leaving Austria in 1921, the Anglobank headquarters remained located in the Palais Montenuovo at Strauchgasse 1–3, opposite the Old Vienna Stock Exchange.
According to the articles of association, each member of the board of directors had to personally deposit at least 100 shares and received a fixed remuneration of 3000 silver guilders per year.
Its London office was initially established at St Mildred's Court, Poultry,[3] and moved in the 1870s to 31, Lombard Street where it remained until World War I.
[12] At the beginning of the 20th century, Anglobank held a leading position in the financing of the Austro-Hungarian lignite mining and in the issuance of government bonds.
Its lobbying operations included participation in daily newspaper Die Presse and in the founding and financing of the magazine Der Österreichische Volkswirt.
[13] In 1913, the company had twice as many branches as the considerably larger Creditanstalt, and only slightly fewer than the Wiener Bankverein, Austria-Hungary’s leading bank by this metric.
[16] Amid the turmoil, the Bank of England became a major shareholder of Anglobank, through the mediation of the Petschek family and under direct watch of Governor Montagu Norman.
During World War I, the British authorities had already confiscated the Anglobank's business in London,[17] which was subsequently relocated in the commercial building at 24, Lombard Street, not far from its previous location at No.
Simultaneously, Anglobank created a subsidiary in Vaduz, the Bank in Liechtenstein AG (BiL, later LGT Group), which began operations on 24 November 1920.
On 27 March 1922, a separate entity named Anglo-Austrian Bank was founded in London, which took over all assets and liabilities of Anglobank with all its syndicated holdings.
About two-thirds of the ordinary shares of Anglobank remained in the possession of pre-war owners in Austria and the other successor countries, mostly small shareholders.
On its behalf, the English board of directors of the Anglo-Austrian Bank wrote a letter to UK Prime Minister David Lloyd George, pointing out the "urgent need" to support the Austrian government through external "aid measures (…) which alone could prevent serious crises".
They argued that a new central bank would not achieve lasting success but only undermine private institutions whose continued strength was critical to Austrian recovery.
[26] Nevertheless, The Austrian National Council passed a federal law of 24 July 1922 to established the Oesterreichische Nationalbank (OeNB), which started operations on 1 January 1923.
[16] Even so, the breakdown of trade relations between the successor states and the increased appeal of economic autarky meant that the flows of British capital deployed in the region through the Anglo-Austrian Bank remained limited.
Negotiations began with Wiener Bankverein, then shifted to Creditanstalt which bought most of the Vienna branches and other assets on 12 June 1926, while some of the bank's investments went to a Dutch holding company.
[28][38] Only in January 1927 was an extraordinary general assembly convened, which completed the elimination of the retail shareholders from representation on the bank’s board of directors.
But this beneficial result ceased when the Austrian stabilization plan was implemented and the connection with the Bank of England began to bear fruit.
France and the UK viewed with extreme suspicion the growing tendencies towards an economic union with Germany that had existed in Austria since the end of the First World War.
[16] Various members of the General Council of the Oesterreichische Nationalbank repeatedly called for a reduction in the discount rate in order to curb the undesirably high inflow of short-term foreign credits.
However, they could not assert themselves against the financial controllers of the Bank of England and Richard Reisch [de], the President of the OeNB, because they saw no need for defensive measures in the event of a temporary external debt.
[53] In addition, Otto Ernst Niemeyer and Pyotr Bark remained on the Creditanstalt Supervisory Board as representatives of the Anglo-International Bank.
[50] On 5 March 1931, Germany and Austria announced a customs union without giving Great Britain and France any prior notice; the latter used different strategies that caused the project to fail in the autumn of 1931.
In addition, France officially declared that it would "reclaim short-term debt securities from Austrian and German banks and not extend them any longer."
[54][55] The Creditanstalt, which through the takeover of the Bodencreditanstalt had become by far the most important bank in Austria with an extensive network of industrial participations, had until then been regarded as an extremely sound institution.
The exact background as to why the management of the Creditanstalt suddenly opted for public disclosure of a marked-to-market valuation of its assets, at the worst possible moment, remains unclear.
British economic historian Harold James put it sarcastically as "Zoltan Hajdu experienced some sort of religious conversion and thereafter felt unable to live with the dishonest accounts his institution presented for two years and he had signed.”[57] The Austrian Ministry of Justice filed claims for damages of 20 million schillings and on 15 October 1931 applied to the Vienna public prosecutor's office for the confiscation of assets and preliminary investigations against Zoltan Hajdu and other directors of the Creditanstalt.
[62] Appeals against all three decisions in this regard – the withdrawal of the banking licence by the ECB, the appointment of liquidators, and the opening of insolvency proceedings – were filed in the respective courts.
While the appeals with respect to the licence withdrawal and the appointment of the liquidators were still pending, the Austrian Supreme Court (OGH) ruled on 13 July 2020 that the opening of insolvency proceedings against the bank had been unlawful.
Prior to and parallel to the licence withdrawal process, the FMA had filed several criminal complaints against the bank and its (former) managers with the Vienna prosecutors.
