Papers of the J. Henry Schroder Banking Corporation

The surviving records of the J. Henry Schroder Banking Corporation and related entities principally cover corporate finance, bond issuing and commercial finance activities. Most of the firm's business was outside the United States, in continental Europe and most significantly in Latin America, and the period covered by these records extends from 1923 to the early 1960s. Records also cover the venture capital activities of Schroder, Rockefeller & Co. Inc. Some accounting and corporate governance records also survive.

The J. Henry Schroder Banking Corporation (often known by its cable name of 'Schrobanco') commenced business in New York in October 1923. It was set up by the London partnership of J. Henry Schröder & Co. to bring their knowledge of commercial banking to the developing New York discount market. Its first president, Prentiss Gray (1884-1935) was a former grain shipper and had been director of the Commission for Relief in Belgium during the first world war. The board of directors included Baron Bruno Schröder (1867-1940) and Frank Tiarks (1874-1952), from the London partnership, and Manuel Rionda (1854-1943), a US based planter and importer of Cuban sugar.

In the 1920s the firm's core activity was dollar trade finance, but it also dealt in foreign exchange, securities underwriting, and participated in a number of foreign bond issues with a representative office in Berlin to market its services as an issuing house for German corporations. In 1924 it participated in the formation of the Continental Securities Corporation, an investment trust which the firm managed until its sale in 1937. The J. Henry Schroder Trust Company, renamed the Schroder Trust Company in 1937, was set up in 1929 to take deposits and manage investment accounts.

Following the Wall Street Crash in 1929, which left the firm almost entirely unscathed, its underwriting activities declined, but it developed a specialised foreign exchange business dealing in restricted currencies and also marketed US securities in Europe. Like the partnership in London, the J. Henry Schroder Banking Corporation was badly hit by the German 'Standstill' on the repayment of foreign debt in 1933, with over $12,000,000 frozen in Germany. Unlike J. Henry Schröder & Co. in London, the J. Henry Schroder Banking Corporation liquidated its holdings at a discount when this became possible.

Following Gray's death in a boating accident in 1935, Gerald Beal (1895-1971) took on the presidency until his retirement in 1962. He developed the firm as a specialist international banking firm, conducted at the Schroder family's request on a "prestigious and prudent" basis. From 1935 the firm established a presence in Latin America, entering into a joint venture, Argentaria SA de Finanzas, in Buenos Aires. In the same year Norbert Bodgan (c1904-1991) moved to the city to expand the firm's activities into Brazil, Colombia and elsewhere.

In 1936 the London partners and Avery Rockefeller (1903-1986) set up Schroder, Rockefeller & Co. Inc. This new company continued the underwriting and securities business that had been carried out by the J. Henry Schroder Banking Corporation prior to the separation of commercial and investment banking activities imposed by the Glass Steagall Act in 1933. Schroder, Rockefeller & Co. Inc. also became active in the field of venture capital.

Following the second world war the J. Henry Schroder Banking Corporation developed its international commercial banking services with clients, including central banks, in Latin America, Europe and Japan and the Pacific Basin. In 1959 the J. Henry Schroder Banking Corporation became part of Schroders Limited, a newly formed holding company in London, of which it constituted 73% of net assets.

The expansion of Eurodollar markets led to increasing business for J. Henry Schroder Banking Corporation in Europe. In 1962 John Howell (1917-2014) succeeded Beal as president, who became chair of the board. In 1968 Schroder Inc. was created as a holding company for the three American Schroder entities: J. Henry Schroder Banking Corporation, carrying out international banking for European, Latin American and Asian clients; Schroder Trust Company carrying out trust banking services for US clients; and Schroder Capital Corporation, previously Schroder, Rockefeller until the retirement of Avery Rockefeller in 1968, carrying out venture capital activities. In the same year Naess & Thomas, an investment manager was purchased and, as Schroder, Naess & Thomas, continued the investment management business previously conducted by Schroder Trust Company. Schroder, Naess & Thomas was renamed Schroder Capital Management Inc in 1980.

In 1970 James Wolfensohn (1933- ) became president of J. Henry Schroder Banking Corporation, succeeded in this role in 1974 by Mark Maged (1931- ), and chair of Schroders Inc. in 1974. Wolfensohn left the firm in 1977. John Bayley replaced him as chair, to be succeeded by John T. Connor (c1915-2000) in 1980.
In 1977 the J. Henry Schroder Banking Corporation and the Schroder Trust Company were merged to become the J. Henry Schroder Bank and Trust Corporation.

In 1983 George Mallinckrodt (1930 - ) was appointed chairman and chief executive officer of the bank, and president and chief executive officer of Schroders Inc, with the task of refocusing the business towards investment banking and investment management rather than commercial banking. Concluding that change within the US competitive and regulatory environment was made more difficult by the firm's ownership structure, a deal was made in 1985 with the Industrial Bank of Japan for the purchase of a 50.1% holding in the J. Henry Schroder Bank and Trust Corporation. The firm was renamed IBJ Schroder Bank & Trust Company on 1 January 1986. Conflicts of interest with Schroder Inc's remaining and expanding activities, notably its purchase of a 50% holding in the investment bank Wertheim & Co., led to the sale of most of the firm's holding in IBJ Schroder Bank & Trust Company by the end of 1986.

Records created before 1940 will normally be made freely available to bona fide researchers, however all access is subject to the archivist's discretion. Visits are by appointment only. Email: history@schroders.com

The majority of these papers were held within the corporate records accumulated by Schroders Inc in New York and were subsequently identified as being of historic value by the historian Richard Roberts in the course of his research for Schroders: merchants and bankers (London: Macmillan, 1992). It is probable that a number of records were transferred to the Industrial Bank of Japan with its purchase of a majority holding in the J. Henry Schroder Bank and Trust Company in 1985, and now no longer exist.

Richard Roberts Schroders: merchants and bankers (London: Macmillan, 1992)