Ports, ships and money : the origins of corporate banking in Valletta

Abstract

This paper traces the origins of the first joint stock banks in Malta and profiles them. These are the Anglo-Maltese Bank (1809), the Banco di Malta (1812) and Biagio TagliaJerro e Figli (1812). Starting during the Continental System, the study includes reference to other banks formed later on, particularly in the 1830s, very much in a colonial context (JoseJ Scicluna et fils, 1830; the Provident Bank for Savings, 1834). Adopting tonnage statistics as a 'barometer of Malta's economy', it relates banking to naval and mercantile shipping, financial and commercial activity, in and around the Mediterranean until the opening of the Suez Canal and its immediate aftermath. Malta's role changed. Branches of international banks started being established (the Anglo-Egyptian Bank in 1881, and then others). The paper also shows how other lines of business, such as insurance companies of various kinds, became indispensable subsidiaries to the market, as the currency itself changed and entrepot trade increased as a result of British imperial influence and interest. Three major stages in this external-internal equation are indicated, first the Continental System (1807-1813), then the Crimean War (1854-1856) and the Suez Canal (1869-). Equally important, however, was the British presence and the strategic imperative, as finance, shipping and commece saw social, economic and demographic changes occur. Banking also introduced new habits, prospects and ways of dealing, including some venture capital initiatives, although commerce remained more important than industry. The presentation endeavours imagintively to recreate some aspects of the prevailing lifestyle, with trade and commerce largely dominated by harbour movements. It concludes by noting a nexus with pivotal economic supports of the Maltese economy today in areas such as banking and financial services, ship registration by flag; and transhipment at the Free Port.