Records of the International Finance Society

The records of the International Finance Society Ltd comprise minute books of board meetings (1863-1912), minute books of committee meetings (1863-1882), a minute book of the Italian Building Society Ltd (1864-1870), account balance books (1863-1878), capital journals (1864-1886), cash books (1867-1911), the register of bills of exchange (1865-1903) and the register of bills payable (1894-1908).

The International Finance Society was founded in 1863. It was the third such company to grow out of the merchant and banking community of London. Merchant banking evolved out of trades in which credit played a large part and the International Finance Society began as an association of firms to pool capital and trade and credit expertise for investment in Europe and the Middle East. Robert Heath of Heath & Company was the first chairman. Initial management of the Society was carried out in board meetings and the first business handled was the reflotation of the stock of the Hudson Bay Co. Reflotation of securities became the mainstay of operations with loans issued for foreign investment. The Society also quickly formed syndicates to buy shares, the success of these ventures depending upon the general bull market of the contemporary stock exchange. The boom of the 1860s helped considerably and the Society was heavily involved in railway development at home and abroad (Cottrell, Investment banking in England, passim).

After the financial collapse of 1866 most financial companies had problems rendering their assets liquid but the International Finance Society, despite having too many illiquid assets purchased before 1866, had enough in the way of cash assets to survive. Ongoing problems were experienced after the crisis in realising loans especially to railway builders. In addition, the Italian Building Society, which the International Finance Society had privately formed in 1864 to finance its loans to building schemes in Turin, proved a financial liability in the late 1860s and was finally liquidated in 1875 at a loss of £15,000 (Cottrell, Investment banking in England, passim).

By about 1880 the Society was more financially secure again, with illiquid assets fully marketable, but it never recovered its position on the London capital market and became a quite minor financial institution. Its directors tended to mobilise the capital of their private banks, especially during the minor boom years of 1870-1873 when the Society became heavily involved in investment in the Finnish sawmilling industry. In the 1880s the Society was able to operate quite profitably again and extended its railway investments into the American market; it did so with a better balance maintained between risk and liquidity than before. The first chairman, Robert Heath, died in 1882 and after his death both the management and the field of business of the Society underwent considerable change and about the turn of the century the Society became part of a group of investment trusts called the '69 Old Broad Street group' controlled by Lord St Davids, J S Austen and M B Snell. From this time the Society operated basically as an investment trust and it was taken over in 1969 by the Second Consolidated Trust. In 1974 the International Finance Society was taken over by the '117 Group Ltd' (Cottrell, Investment banking in England, passim).

U DFS/1-17 Minute books of the IFS, 1863-1912

U DFS/18 Minute book of the Italian Building Society Ltd, 1864-1870

U DFS/19-40 Account books of the IFS, 1863-1911

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Deposited by the International Finance Society Ltd. in 1966

• Cottrell, Philip, British overseas investment in the nineteenth century (1975)
• Cottrell, Philip, Investment banking in England, 1856-1882: case study of the International Finance Society, 2 vols., (PhD, Hull, 1974)