The models: the crédit mobilier in France and Germany

The Pereires and the Crédit Mobilier of 1852

The institutional idea that Escher brought to Zurich originated in the Paris of the Second Empire. In 1852 the brothers Émile and Isaac Pereire founded the Société Générale du Crédit Mobilier with an initial capital of 60 million francs. The company was organised as a joint-stock company with limited liability and was permitted to issue obligations up to ten times its capital, so that in principle 60 million francs of equity could support 600 million francs of debt. Its purpose was to mobilise the savings of the middle classes and to channel them into large enterprises, playing a leading part in the financing of railways, gas lighting, steamship lines and the public transport of Paris.¹ The brothers came from the circle of the Saint-Simonians, for whom the extension of credit to productive industry was an instrument of social progress. That background gave the new bank an ideological edge that its competitors among the older Parisian houses of the haute banque, above all the Rothschilds, did not share.

The capital of the Crédit Mobilier was divided into 120,000 shares of 500 francs. The new bank enjoyed the support of Achille Fould, finance minister under Napoleon III, whose family bank was among its first backers. Its business consisted in buying shares and bonds of the enterprises it promoted and in lending against securities. In 1855 its shares reached 1,900 francs and its market capitalisation almost 230 million francs.² The model looked irresistible in the boom of the mid-1850s. It combined three functions that had until then been performed separately: the promotion of new companies, the placing of their securities with the public, and the holding of participations on the bank’s own account. For contemporaries the name “crédit mobilier” came to designate this combination as a type, independently of the particular Paris company, so that Italian, Spanish and Austrian imitations carried the same label.

The weaknesses of the model became visible only later. A bank that financed long-term industrial investment with short-term funds while holding large blocks of shares in the companies it promoted was exposed to every fall in the securities market. The crisis of 1866 and 1867 brought heavy losses to the Crédit Mobilier and forced the Pereire brothers to resign. The bank was reorganised in 1871 and never recovered its former importance.³ The history of the French prototype thus offered both the promise and the warning that accompanied the Kreditanstalt through its first decades. Escher and his associates adopted the idea at the height of its prestige, a decade before its most spectacular failure. The first years of the Zurich bank would show that the risks of concentrated participations were not confined to Paris.

France itself drew a distinctive conclusion from the experience. After the company law of 1863, and more fully after 1867, the French legislator eased the formation of joint-stock companies, and new banks such as the Crédit Lyonnais (1863) and the Société Générale (1864) were created to gather the savings of the middle classes.⁴ These deposit banks gradually moved away from the industrial participations that had brought down the Crédit Mobilier. Over the following decades, a division of labour emerged in France between deposit banks and banques d’affaires. The Swiss path, as later sections will show, ran in a different direction: the big banks of Zurich and Basel retained the combination of deposit and investment business within one institution. Later literature calls this combination the universal bank.

The German reception: Cologne, Darmstadt and the wave of 1856

The German states received the crédit mobilier idea in the particular conditions of a fragmented political landscape, in which joint-stock banks required a concession from the sovereign and several governments were suspicious of them. The first German joint-stock bank arose almost by accident. When the Cologne private bank A. Schaaffhausen got into difficulties in the revolutionary year 1848, its creditors voted on 3 June 1848 to convert it into a joint-stock company, and King Frederick William IV of Prussia ratified the conversion on 28 August 1848. Gustav Mevissen, the Rhenish entrepreneur and liberal politician, joined its management in October of that year and later chaired its board.⁵ The A. Schaaffhausen’scher Bankverein remained for two decades the only joint-stock bank in Prussia, a sign of how reluctant the Prussian state was to license institutions of this kind.

Mevissen and a group of Cologne bankers, among them Abraham Oppenheim, found a way round that reluctance. Since no concession for a joint-stock bank could be obtained in the Free City of Frankfurt or in Prussia, they turned to the Grand Duchy of Hesse. On 2 April 1853 the Bank für Handel und Industrie was founded in Darmstadt with a capital of 25 million gulden. It was modelled on the Crédit Mobilier, obtained backing from the Paris company and became known simply as the Darmstädter Bank.⁶ Darmstadt thus became, for a time, a centre of German industrial finance because its government was willing to grant what larger states refused. The episode illustrates a pattern that recurs in the history of financial centres, including Zurich: the location of an institution often follows the availability of a legal permission more closely than the location of trade.

The years 1855 and 1856 brought a wave of further foundations in Germany. The Berliner Handels-Gesellschaft of 1856 was inspired by the experience of the Crédit Mobilier and of the Darmstädter Bank. It was one of the first five large commercial banks in Germany, together with the Schaaffhausen bank, the Disconto-Gesellschaft (1851–1856), the Darmstädter Bank and the Mitteldeutsche Creditbank in Meiningen (1856).⁷ In Leipzig, a founding committee formed in January 1856 that included Gustav Harkort, Albert Dufour-Féronce and merchants from Hamburg, Berlin, Dresden and Breslau. Out of its work, the Allgemeine Deutsche Credit-Anstalt was established there in the same year as a joint-stock company.⁸ This Leipzig bank is of direct importance for the Zurich story, as the next section will show.

Geneva’s early experiment: the Banque Générale Suisse (1853)

Switzerland had already seen one attempt to transplant the crédit mobilier before Escher took up the idea. In Geneva, the radical leader James Fazy had used the new cantonal constitution of 1847 to create a series of financial institutions, among them the Caisse hypothécaire (1847), the Banque de Genève (1848) and a discount bank. In 1853 he added the Banque Générale Suisse de Crédit International Mobilier et Foncier, which opened one year after the Paris Crédit Mobilier and three years before the Kreditanstalt of Zurich.⁹ The Geneva bank began with a nominal capital of 25 million francs, of which only 5 million were paid up. It committed itself to the western Swiss railways and to distant projects, including a scheme for a canal across Panama, before foundering in the middle of the 1860s.

The collapse of the Banque Générale Suisse brought down Fazy himself, whose political and financial position had been bound up with it.¹⁰ The Historisches Lexikon der Schweiz dates its liquidation to 1869.¹¹ For the history of the Swiss financial centre, the Geneva episode has a double significance. It shows that the crédit mobilier idea was in the air across Switzerland in the early 1850s and that Zurich was not its first Swiss home. It also shows how much depended on the quality of governance and on the choice of business. The Geneva bank chased speculative projects in distant markets, while the Zurich bank, for all its early difficulties, anchored itself in the financing of a domestic railway network and of the industries of its region. The contrast between the two outcomes forms one of the quieter reasons for the later pre-eminence of Zurich over Geneva in large-scale commercial banking, a theme that the companion volume on Geneva treats from the other side.

Notes

1. Wikipedia (English), “Crédit Mobilier”, https://en.wikipedia.org/wiki/Cr%C3%A9dit_Mobilier (accessed September 2026). The article records the capital of 60 million francs, the permission to issue obligations up to ten times its capital and the bank’s role in railways, gas lighting, shipping and Parisian transport. It is cited here for orientation; the standard French literature on the Pereires treats the same facts in greater depth. ↩
2. The Tontine Coffee-House, “The Meteoric Rise and Fall of Crédit Mobilier”, 28 October 2019, https://tontinecoffeehouse.com/2019/10/28/the-meteoric-rise-and-fall-of-credit-mobilier/. The blog gives the share structure, Fould’s role, the market valuation of 1855 and the losses of 1867; it is a secondary popular account, and the figures should be read as orders of magnitude. ↩
3. Wikipedia (English), “Crédit Mobilier” (cited above), sections on the crisis of 1866–1867 and the reorganisation of 1871. ↩
4. Cité de l’économie (Citéco), “Creation of large French banks”, https://www.citeco.fr/10000-years-history-economics/industrial-revolutions/creation-of-large-french-banks. The page connects the foundation of the Crédit Lyonnais and the Société Générale with the law of 1863 and the purpose of absorbing middle-class savings. ↩
5. Wikipedia (English), “A. Schaaffhausen’scher Bankverein”, https://en.wikipedia.org/wiki/A._Schaaffhausen%27scher_Bankverein. The article notes that the bank remained Prussia’s only joint-stock bank for more than two decades and describes Mevissen as general manager (1848–1857) and chairman (1857–1875). ↩
6. Wikipedia (English), “Darmstädter Bank”, https://en.wikipedia.org/wiki/Darmst%C3%A4dter_Bank. The article names Wilhelm Ludwig Deichmann, Gustav Mevissen, Abraham Oppenheim and Victor Wendelstadt as founders and explains the choice of Darmstadt by the refusal of concessions in Frankfurt and Prussia; it also records the transfer of the head office to Berlin in 1873 and the merger that formed the Danat-Bank in 1922. ↩
7. Wikipedia (English), “Berliner Handels-Gesellschaft”, https://en.wikipedia.org/wiki/Berliner_Handels-Gesellschaft, with the list of the first five large German commercial banks and the reference to the Crédit Mobilier and the Darmstädter Bank as models. ↩
8. Wikipedia (German), “Allgemeine Deutsche Credit-Anstalt”, https://de.wikipedia.org/wiki/Allgemeine_Deutsche_Credit-Anstalt. The article lists the members of the founding committee of January 1856 and states that the ADCA was among the founders of the “Schweizerische Creditanstalt Zürich”. ↩
9. Encyclopédie de Genève, Jean-François Bergier, Armand Brulhart, Robert Iselin, Marian Stepczynski and Jean-Daniel Vermeil, “La banque et la finance”, https://encycloge.org/la-banque-et-la-financejean-francois-bergier-armand-brulhart-robert-iselinmarian-stepczynski-jean-daniel-vermeil.html. The text describes the bank’s nominal capital of 25 million francs, of which 5 million were paid up, its engagement in the Chemins de fer de l’Ouest and in a Panama canal project, and its collapse in 1865. ↩
10. HLS, Jean de Senarclens, “Fazy, James”, version of 7 February 2018, https://hls-dhs-dss.ch/fr/articles/003866/2018-02-07/. The article lists Fazy’s banking foundations and states that the failure of the Banque générale suisse in 1865 brought about his ruin; it also records that Fazy was rapporteur of the federal railway law of 1852. ↩
11. HLS, Youssef Cassis, “Banken”, section “Das Bankensystem nach 1850”, version of 17 August 2006, https://hls-dhs-dss.ch/de/articles/014061/2006-08-17/. Cassis lists the Banque Générale Suisse (Geneva, 1853, liquidated 1869), the SKA (1856), the Bank in Winterthur (1862), the Basler Handelsbank (1862), the Eidgenössische Bank (1863), the Schweizerische Volksbank (1869) and the Basler Bankverein (1872) as the principal new foundations inspired by the crédit mobilier model. ↩

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 September 2025.