Start 1861: I Just Inherited the Dutch Throne

On May 1, 1881, the British Treasury announced that it would buy gold in large quantities with pounds. At the same time, the United Kingdom began not to recognize the exchange rate between the Dutch guilder and the pound.

Britain is an international financial power. It is the world's second largest import and export country after the Netherlands. In the past, the Dutch guilder and the British pound could be directly exchanged. However, with the UK's move, the Dutch guilder's popularity in the world has become smaller, and its scope of use has narrowed. .

The current British Chancellor of the Exchequer, Childers, seems to have begun to attack the Netherlands to some extent.

A seemingly small policy change turned out to be a big disaster for the Dutch guilder.

The reputation and trust of the Dutch guilder has been reduced to a historical low, and the Dutch people in the country have begun to withdraw cash in large quantities. As a result, many small and medium-sized banks in the banking industry have begun to suffer from insufficient deposits, or withdrawals have caused banking crises.

On May 3, 1881, due to the flow of Dutch guilders in the world, many international banks in the Netherlands were affected.

Furthermore, many small and medium-sized banks filed for bankruptcy.

Even the First Bank of Rotterdam, a European territory in the Netherlands with more than a century of history, is among them.

This can cause greater financial panic.

To this end, the Ministry of Finance of the Dutch government held an emergency reassurance work. At the same time, the Dutch Central Reserve Bank (DBN) publicly stated that it did not believe that the Netherlands would face a financial crisis.

On May 4, 1881, Sackham, director of the Dutch Financial Commission and chairman of the Dutch Federal Reserve Bank, held a financial conference in Melbourne. Deputy Prime Minister and Minister of Finance Jules Danetang; Assistant Minister of Finance and Special Assistant to the Financial Commission Andrew; Frank, president of the National Bank of East India; Vanderlip, president of the Far Eastern Bank of Commerce, Davidson, president of the Dutch Union Bank; Sir Henry, senior partner of the Royal Dutch Bank Investment Company; Norton, president of the First Bank of Sydney controlled by the Royal Investment Company.

The gathering of these Dutch financial giants was obviously in the face of the biggest financial crisis in the history of the Netherlands, and they held a rally to deal with the Dutch guilder exchange rate crisis created by the British Treasury.

Outsiders do not know the content of this meeting of financial giants in the Netherlands, but later when the Dutch Federal Reserve announced that it would raise interest rates to 3.5 points for deposits in response to the possible depreciation of the Dutch guilder, this was a full increase of 0.5 points from the previous 3. So the Dutch guilder began to win back many customers at home and abroad.

So the wave of guilder withdrawals from Dutch banks subsided, and deposit rates began to stabilize and pick up.

William IV was satisfied when he saw this, with a smile on his face.

The Finance Minister Danetang and the Director of the Financial Commission and the Chairman of the Dutch Federal Reserve, Sackham, who were nearby, breathed a sigh of relief when they saw this.

Obviously, the crisis in the Dutch financial sector made the two managers very nervous.

Just as they were secretly rejoicing, William IV said: "However, this is not enough. We should carry out more banking reforms."

reform?

Both Danetang and Sackham raised their heads and looked at William IV in confusion.

"There are many small banks in the Netherlands, it is said that there are more than 500. Almost every province and city in the Netherlands has a local private bank. It is very small, but like this crisis, its management ability and ability to respond to risks are very poor. .

Stress tolerance is also very unsatisfactory. Even if I managed to survive this time with the support of the government, will I be able to do it next time? "

As far as I know, First Private Bank of Rotterdam is the 20th largest bank in the Netherlands. However, due to risk control and blind expansion of business, branches are everywhere.

And just like the British business, the pound also accounts for a large share of the exchange benefits in the bank's exchange rate. Finally, when faced with the wave of cash withdrawals, I panicked, so now the bank no longer has enough Dutch guilders in cash to deal with it. "

When Danetang and Sackham heard this, their expressions changed greatly, because according to what William IV just said, they were planning to take action against the First Private Bank of Rotterdam.

Killing the chicken to scare the monkeys or the polydomino effect?

However, William IV's instructions were what they had to implement.

On May 6, 1881, the East India National Bank, the largest bank in the Kingdom of the Netherlands, was competing for acquisitions and selections with Dutch financial giants such as Far East Commercial Bank, Dutch Union Private Bank, First National Bank of Sydney, and Royal Dutch Investment Company. Taking the lead, the National Bank of the Netherlands East India acquired the First Private Bank of Rotterdam, making the crisis caused by the British not recognizing the exchange rate between the pound and the Dutch guilder suddenly more eye-catching.

Many people from abroad have even paid attention to it.

The British Financial Times directly published a questioning report, and British Finance Minister Childers declared in London, "The Netherlands' actions have made people see that the crisis in the Dutch financial industry has become even more bizarre."

"Whether the consequences of the East India National Bank's acquisition of the First Private Bank of Rotterdam will trigger a more serious storm in the future, I doubt the optimism that the Dutch conquest is currently showing. I think the pound is more valuable than the Dutch guilder." Possessing, the Dutch guilder and the Dutch financial community may be more worthy of consideration by the financial decision-makers of the Kingdom of the Netherlands.”

Childers even questioned the fairness in Britain's most authoritative financial newspaper and said: "The National Bank of East India was able to win the first prize in a short period of time in competition with many large Dutch banks and investment institutions. What is the real reason for the top spot? To a large extent, it must be attributed to his chairman and CEO Lemmon, because as we all know, he was formerly the deputy minister of the Dutch Ministry of Finance.”

The British finance minister, who single-handedly promoted the decoupling of the pound from the Dutch guilder, confidently commented on the Netherlands in London: "After the acquisition of the First Private Bank of Rotterdam from the National Bank of East India, the crisis of hundreds of private banks in the Netherlands seems to be temporarily over. Silence fell. Linden's cabinet government is currently focusing on the subsequent examples of large banks acquiring smaller banks that have been taking place in the Dutch financial sector.

This is obviously an attempt by the Dutch government to prevent the collapse of small banks, and the current wave of acquisitions is to gather many uneasy factors in large banks and make them easier to manage. "

This senior official with great reputation in the British financial community said: "But judging from the mystery behind the National Bank of East India's selection of Germans to acquire the second failed bank in the Netherlands in history, we must definitely say that this local banking crisis has already It’s over, I’m afraid, it’s too early to tell, and it’s hard to say that the role played by the National Bank of East India this time will not in turn become a thorny issue for the Dutch government in the future.”

"It's just that in the future without Lemon, if the National Bank of East India wants to continue to play the role of savior and overcome challenges, I'm afraid it's not just a matter of whether Lemon's successor is qualified, but also whether the Dutch government will be like Lyndon. , turning a blind eye to the worsening problem of a few large banks such as the National Bank of East India being too big to fail, and continuing to support the acquisition of Haishu."

Childers recounted in an almost sarcastic tone: "This does not mind the situation derived from the few large banks in Sydney Financial Street in the Netherlands that strangles and threatens the financial system. After all, the East India National Bank acquired the First Private Bank of Rotterdam. Whether the risks and consequences it brings will trigger a storm more severe than the current crisis in local small and medium-sized banks in the future is probably more worthy of careful consideration by policymakers."

The British Chancellor of Finance's statement clearly indicates that the UK will launch more attacks on Dutch finance and he has reserved his opinion. As a result, small banks in the Netherlands and banks related to foreign trade exchange rates are even more panicked.