A Case Study on British International Banks: The London Office of the Hongkong and Shanghai Banking Corporation, 1875–1889

The years 1875–1889 saw changes caused by improved transportation, communication and the long-term declining trend in the value of silver that led to the rise of the Hongkong and ShanghaiShanghai Banking CorporationHongkong and Shanghai Banking Corporation (HSBC) (HSBC). The HSBC’s success could be attributed mainly to its adoption of the “on an even keel” policy. The London Office of the bank played an essential role in implementing this policy. In this chapter, I used chiefly the correspondence of David McLeanMcLean, David, the manager of the London Office from 1875 to 1889, in examining the actualities of business activities in the London Office of HSBCLondon Office, HSBC. This chapter divides into four sections. Section 1 analyzes the finance trade business. Section 2 examines the relationship of HSBC and its correspondent banks. Section 3 considers the deposit-taking activities while Sect. 4 deals with cooperative relationship between British international banks. This research revealed that HSBC strengthened its financial networks in London in responding to changes in international payment system as well as the growth of its trade finance business. Moreover, it showed that the dynamics of competition and cooperation between international banks were significant in shaping the international payment system between Asia and the West and vice versa. By the middle of the 1880s, HSBCHongkong and Shanghai Banking Corporation (HSBC) proved an unwavering position in international capital movement between East Asia and BritainBritain.