Banks (entry)

Categories / Economy/Finances and Credit
BANKS, credit system institutions. St. Petersburg has been the central element of the system from the time it came into being through 1917. The first banks in Russia were founded on the initiative of the state and financed from the treasury including the Bank for the Nobility or the Nobility Loan Bank founded in 1754-86 and reorganised into the State Loan Bank closed down in 1860 and the Merchants' Bank or the Bank for Improvement founded under the auspices of the Commercial Port of St. Petersburg in 1754-82 to provide short-term credit for export trade. After the Merchants' Bank had been liquidated, it was the Discount Offices of the State Assignation Bank that were in charge of crediting in 1797-1817, replaced by the State Commercial Bank in 1817-60. The Assignation Bank was opened in St. Petersburg in 1769 and reorganised into the State Assignation Bank of the Russian Empire after merging with the Assignation Bank of Moscow in 1786. The first banks were liquidated in 1859-60; the State Bank of the Russian Empire was founded instead in 1860 as a united bank. Two Mortgage Banks - the Peasants' Bank (from 1882) and the Nobility Bank (1885) - also belonged to the state. Joint-stock commercial banks formed the basis of the credit system. While there was a total of 50 commercial banks in the country, 13 of them operated in St. Petersburg. The first private commercial bank was founded in 1864. The banks of the capital were the largest; their funds amounted for 64% of the country’s total figure in 1914. They had 574 branches to handle enormous amounts of money throughout the country. Over 70% of liabilities were accumulated in St. Petersburg, and its banks were virtual owners in the capital market. They performed about 70% of all transactions in various sectors of economy. Among the banks of St. Petersburg, the Russian-Asian Bank, the St. Petersburg International Commercial Bank, Azovsko-Donskoy Bank, the Russian Bank for Foreign Trade, and the Russian Bank of Commerce and Industry played a major role, each of them being a monopolist bank. Volzhsko-Kamsky Bank, the Siberian Merchant Bank, the St. Petersburg Private Commercial Bank, and the St. Petersburg Discount and Loan Bank were also among the largest national banks, though inferior to the former. The role they played in the credit system grew stronger as bank groups were formed to coordinate activities. Industry financing was a major line of activity of the banks, emerging during the period of economic growth of the 1890s and continuing in 1908-13. It was via the banks that capital flowed heavily into industry to found new enterprises, expand production, launch new production processes, and increase production volumes. To provide the capital inflow, the banks would place newly issued shares and frequently co-own enterprises; bank managers would manage and take control over plants and factories. The banks played a leading role in the most critical industries such as metal-working and machine-building and had close links with metallurgy, petrochemical industry, and copper-rolling before the beginning of World War I of 1914-18. They also established and strengthened their ties with food processing and light industry, sugar industry and tobacco industry in particular. The banks of St. Petersburg played an important part in creating a number of monopoly concerns. Their activities stimulated Russian economy making it to a large extent a single whole. Banks centralised in St. Petersburg, and the capital became the central element of the national economy. The percentage of the largest banks of St. Petersburg grew even higher and the influence stronger during World War I. After the October of 1917, private banks were nationalised and merged with the State Bank as decreed by the Soviet of People's Commissars on December 14, 1917. The People's Bank of the Russian Soviet Federative Socialist Republic founded on the basis of private banks moved to Moscow in 1918. No longer had the centre of the credit system, St. Petersburg lost its control over the economy. There were only branches of the State Bank in St. Petersburg (Leningrad) in 1917-87, as well as branches of Prombank in 1922, reorganised into Stroibank in 1959, and the Bank for Foreign Trade of the USSR in 1924. Regional offices of specialised banks opened in Leningrad in 1987 including the offices of Promstroibank of the USSR, Agroprombank of the USSR, Zhilsotsbank of the USSR, the Savings Bank of the USSR, and Vnesheconombank of the USSR. Changes in the banking sector began in 1988 as the first commercial banks - Energomashbank and Tekhnokhimbank - were opened in Leningrad in order to provide banking services to engineering plants and chemical factories. Food industry enterprises founded Lenpischeprombank in 1990, reorganised into Vitabank in 1991. The Banking Act of the Russian Soviet Federative Socialist Republic passed in 1990 put an end to the state monopoly in the banking sector. Joint-stock commercial banks sprang up again, Promstroibank and Lenbank among the first banks opened in St. Petersburg on the basis of branches of state banks, the latter reorganised into the St. Petersburg Bank. There were over 100 banks - 40 regional banks and 62 branches of out-of-town banks - operating in St. Petersburg by the end of the 20th century. They tended increasingly to expand their services and play a more significant role as intermediaries between businesses. Granting short-term loans and credits is the major activity the banks of St. Petersburg perform today, Promstroibank, BALTUNEXIM BANK, Petrovsky Narodny Bank, Saint-Petersburg Bank, and MENATEP were among the largest banks.

References: Гиндин И. Ф. Русские комммерческие банки: Из истории фин. капитала в России. М., 1948; Бовыкин В. И., Петров Ю. А. Коммерческие банки Российской империи. М., 1994; Белозеров С. А. Рынок банковских услуг как структурный элемент финансового рынка России // Вестн. С.-Петерб. ун-та. Сер. 5, Экономика. 2000. Вып. 3. С. 143-149; Савинская Н. Традиции кредитования возрождаются // Банковское дело в Москве. 2000. № 6. С. 19-20; Петербург: История банков / Б. В. Ананьич, С. Г. Беляев, З. В. Дмитриева и др. СПб., 2001.

V. S. Solomko. Петров Ю. А., Бовыкин В. И. Коммерческие банки Российской империи. М., 1994
Петербург: История банков / Б. В. Ананьич, С. Г. Беляев, З. В. Дмитриева и др. СПб., 2001
Савинская Н. Традиции кредитования возрождаются // Банковское дело в Москве, 2000
Гиндин И. Ф. Русские комммерческие банки: Из истории фин. капитала в России. М., 1948
Белозеров С. А. Рынок банковских услуг как структурный элемент финансового рынка России // Вестн. С.-Петерб. ун-та. Сер. 5, Экономика., 2000 Assignation Bank
State Bank
State Peasant Land Bank
Nobility State Land Bank
St. Petersburg Private Commercial Bank
Russian-Asian Bank
St. Petersburg International Commercial Bank
Azovsko-Donskoy Commercial Bank
Russian Bank for Foreign Trade
Russian Bank of Commerce and Industry
Volzhsko-Kamsky Commercial Bank
Siberian Merchant Bank
St. Petersburg Discount and Loan Bank
1754
1817
1864
1895