Hamburger Bank

The Hamburg City Council made the decision to create the bank in February 1619, following lengthy negotiations with its civic stakeholders. Like its model, the Amsterdamsche Wisselbank which had been founded in 1609, it was intended to improve monetary stability in uncertain times and to simplify trade between merchants. The numerous English merchant adventurers, Portuguese Sephardi Jews and Dutch religious refugees living in Hamburg at the time brought their capital and knowledge to the bank, thus contributing to its initial success.

The bank was administered free of charge by two Senators, two City elders (Oberalten), two "treasury citizens" (Kammereibürger) and five "bank citizens" (Bancobürger), namely citizens who had an account at the bank. The bank's premises were in Hamburg City Hall. To open an account at the bank, one had to bring an initial amount of at least 400 Lübeck Marks. In addition, regulations were issued that generally prohibited bills of exchange and private trade in metallic money, and bills of exchange over 400 Lübeck Marks had to be processed through the Hamburger Bank.

On 20 November 1619, Lehnbanco was founded as a department of the Hamburger Bank. It gave loans against collateral to merchants as well as to the City of Hamburg itself. The Hamburger Bank was also assigned the municipal mint and the municipal grain warehouse, but these still had independently accounting. From 1725 to 1736, the Courantbank was set up as a subdivision of the Hamburger Bank, with the aim to counteract massive currency debasement at the time. Courant is an old word for currency and refers to coins whose precious metal content supports their value.

The Hamburger Bank held a reputation for good governance and integrity. German economist Paul Jacob Marperger described it as follows:[2]

The world-famous bank, which is better than any bank in the world in terms of purity of its bank money, as it has conserved the old and just [...] Reichstaler and has not tolerated any inferior ones [...] The bank is run by agile and faithful people [...] The order and diligence with which they conduct their operations is admirable, and every day large sums are deposited and withdrwan in a more straightforward manner than with Italian banks. Whoever comes to the bank and asks for example what moneys have been transferred to his account on the previous day will be given clear answers.

— P.J. Marperger, Beschreibung der Banquen (1717), translated by Ulrich Bindseil

The Savary brothers made similar observations:[2]

[...] although the size of this bank is not as considerable as the one in Amsterdam, the fidelity and exactness with which everything is being done there have given it a great reputation throughout Europe, and in particular in the North.

— Jacques & Louis-Philémon Savary, Dictionnaire universel de commerce (1750), translated by Ulrich Bindseil

The bank weathered successive crises with various degrees of success. Unsecured loans in particular were a serious problem. In 1770 the bank was comprehensively reformed. During the era of Napoleonic rule in Hamburg, the bank was looted and also hit hard by economic crisis, but it survived.

The Hamburger Bank ceased to be a stand-alone entity following the Unification of Germany, and was converted into a branch of the newly created Reichsbank at the end of 1875.

The account holders' deposits, paid in metallic money, were recorded in the Bank's books in units that were first the Bancotalers and later the "Mark Banco". The silver content of the Bancotaler in 1619 was set according to the Imperial regulation of currency known as the Reichsmünzfuß. The Mark Banco, however, was a pure unit of account and was not issued as metal currency. In 1622 a Mark Banco corresponded to a silver weight of 8.66 g. The bank took silver bars at a rate of 59 1/3 Marks Banco per Custom Pound (Zollpfund) and credited it to the depositor on his account (Folium). From there he could make cashless payments to other account holders by credit and debit. The Mark Banco was divided into 16 shillings (Schilling) of 12 pennies (Pfennig) each. Since the Mark Banco was viewed as stable in value, it was used in wholesale and mortgage loans, and the merchants carried their books in Mark Banco. In addition, the rates for other currencies and goods were published regularly. Later, a Mark coin was also minted in Hamburg, which was called the Mark Courant and whose value was different from the Mark Banco.

At the time of German currency unification in 1875, the new currency was named Mark (the German gold mark), as a comparatively neutral choice to replace the various southern Guilders and northern Thalers, and also to accommodate sensitivities in Hamburg about the disappearance of the celebrated local bank. The German national currency would retain the name Mark, inherited from the Hamburger Bank, until its replacement by the euro.

On 24 July 1861 a cooperative bank was founded with a similar name, the "Hamburger Bank von 1861 Volksbank eG". It is now known as Hamburger Volksbank.