From merchant capital to banking: Leu & Co. and the Zurich merchant-bankers

The silk merchant as banker

The step from trade to banking was short in early modern Zurich. A silk merchant who bought raw silk in Bergamo, paid for it with bills of exchange drawn on Milan or Genoa, advanced material to hundreds of outworkers and sold the finished goods on credit at the Frankfurt fairs was already conducting most of the operations of a bank. He accepted and discounted bills, extended credit, held balances with correspondents abroad and kept accounts in several currencies. The Historisches Lexikon der Schweiz notes that the merchant elites of Zurich, who had traded in grain and iron in the fifteenth century, added money-lending once the prohibitions of usury had been relaxed, and that a class of textile merchants re-emerged in Zurich in the second half of the sixteenth century.¹ The Locarnese families belonged to this second group.

Daniel Orelli (1653–1726) is the first member of the family whom the sources describe expressly as a "merchant and financier".² By his time the Orelli had become, according to the Historisches Lexikon der Schweiz, the leading traders of Zurich, a position they had reached by 1700. They fell to third place by the middle of the eighteenth century and to ninth by 1797.³ The relative decline did not mean impoverishment. It reflected the rise of new families and the diversification of the Orelli into public office, scholarship and publishing, as later sections show. In the nineteenth century, according to the same source, many of the old textile families, among them the von Muralt of Zurich, specialized in banking.⁴

Leu & Co.: a state bank for private savings

The institution that has been described as the oldest bank in Switzerland grew out of the surplus capital that the silk and cotton trade had accumulated in Zurich. In 1755 the city created a public bank under the direction of the treasurer Johann Jacob Leu, who gave it its name in accordance with the practice of naming such bodies after their director. The Historisches Lexikon der Schweiz describes the institution as a public bank created to place capital abroad on behalf of the large private fortunes and of the state. Its principal founders were Hans Conrad Heidegger and Leu himself.⁵ Leu chaired the Zinskommission (commission on interest), an independent body that invested the funds of Zurich citizens abroad and appeared externally under the name "Leu & Cie".⁶ The bank opened on 15 April 1755 in the Zurich city hall, where at first a single employee handled all the business.⁷

Leu (1689–1768) was a typical figure of the Zurich ruling class: a jurist, author of the Eydgenössisches Stadt- und Land-Recht (1727–1746), a pioneering systematic account of private law in the Confederation, and editor of the twenty-volume Allgemeines Helvetisches, Eydgenössisches oder Schweitzerisches Lexicon (1747–1765). He served as Landvogt of Kyburg from 1736 to 1742, became treasurer in 1749 and mayor in 1759.⁸ His career shows how political office, legal learning and the management of public and private capital were combined in the hands of the same families.

Notes

1. Illi and Stadler, "Marchands" (above). ↩
2. Lassner, "Orelli, Daniel" (above): "Marchand et financier". ↩
3. Wikipedia, "Orelli family" (above): leading traders by 1700, third place by the middle of the eighteenth century, ninth in 1797; Huber and Illi, "Orelli" (above), on the leading position around 1700. ↩
4. Illi and Stadler, "Marchands" (above), listing the von Muralt of Zurich among the textile families from which early nineteenth-century merchants descended, "many" of whom specialized in banking. ↩
5. Jan-Henning Baumann, "Banque Leu", in DHS, version of 3 November 2022, https://hls-dhs-dss.ch/fr/articles/041661/ (consulted 4 October 2026): "créée en 1755 à Zurich comme banque publique". Wikipedia, "Bank Leu", https://en.wikipedia.org/wiki/Bank_Leu (consulted 4 October 2026), describes it as "the oldest Swiss bank"; Georg von Wyß, "Leu, Hans Jacob", ADB 18 (1883), 467–469 (above), explains the name by the custom of naming such institutions after their director and dates the creation of the Zinscommission to 1754. ↩
6. Zelger-Vogt, "Leu, Johann Jacob" (above). ↩
7. Hans Rudolf Schmid, "Leu, Johann Jakob", in Neue Deutsche Biographie 14 (1985), 363–365, https://www.deutsche-biographie.de/sfz50693.html (consulted 4 October 2026): opening on 15 April 1755 at the city hall; "Zunächst erledigte ein einziger Angestellter die anfallenden Arbeiten." ↩
8. Zelger-Vogt, "Leu, Johann Jacob" (above). ↩

For general information only. This article does not constitute legal or tax advice, does not replace advice on an individual case and creates no lawyer-client relationship. It reflects the legal position as of October 2026.