Background and creation Following the early phases of the
French conquest of Vietnam, the
Comptoir d'escompte de Paris (CEP) in 1864 opened offices in
French Cochinchina, and also developed a presence in
Pondicherry,
Calcutta,
Bombay,
Shanghai,
Hong Kong, and
Yokohama. Meanwhile, the rival
Crédit Industriel et Commercial (CIC) had become the Paris correspondent of the
Hong Kong and Shanghai Bank, and had powerful political backers in the conservative Catholic administration under France's President
Patrice de MacMahon. In the early 1870s, both banks developed competing projects to create an institution that would receive the privilege of
issuing money in
French Indochina. , the CEP's Chairman and board member of the BPPB, was the new venture's founding chairman, and its founding (general manager) was the CEP's Pierre Girod. At its creation, it took ownership of the CEP's former branches in
Saigon and
Pondicherry. and of notes to the
Bank of France. Following the
Treaty of Tientsin (1885) that concluded the
Sino-French War, France consolidated its colonial rule northwards over
Annam and
Tonkin. Competitors of the CEP, and especially the
Société Générale, feared the Banque de l'Indochine would monopolize credit and banking activity in the expanded territory. The French government, whose moderate Republican orientation was supported by the CEP against the more conservative Société Générale, leveraged that situation to encourage the Banque de l'Indochine to increase its credit provision and provide more support to Indochina's economy. A compromise was found in 1887 under which the Société Générale would join the Banque de l'Indochine as a minority shareholder, through a capital increase that was closed on and resulted in a 15.5 percent stake for Société Générale. Meanwhile, the bank's issuance privilege was extended to Annam and Tonkin in February 1888, as well as to
New Caledonia. Following that restructuring, the CEP controlled four of the board's eleven seats, CIC three, and Société Générale and the BPPB one each. The CEP's influence was eclipsed following its collapse in 1889, but it came back as the
Comptoir national d'escompte de Paris (CNEP) with one board member in 1890 and retook the Banque de l'Indochine's chairmanship in 1892. From that date, the Banque de l'Indochine effectively became a joint vehicle ("") for the Paris banking community's activities in the Indo-Pacific. That evolution was completed in 1896 as the
Crédit Lyonnais, which had expanded into Egypt and India, entered the Bank de l'Indochine's capital and board. in
Nouméa,
New Caledonia on , It opened offices () in
Hanoi on ,
Hong Kong on (taking over the former office of the CNEP),
Bangkok in February 1897,
Canton and
Hankou (now part of
Wuhan) on ,
Battambang (then in
Siam) in August 1902,
Singapore on ,
Tianjin on ,
Beijing in July 1907, and Yunnan-Fu (now
Kunming) in 1910. On , for the first time, the Banque de l'Indochine printed its own piastre banknotes at a new facility in Saigon. In 1900, the bank's Shanghai office participated in the financing of the French contribution to the international expeditionary corps that suppressed the
Boxer Rebellion, and subsequently represented the interests of the French government in handling the
Boxer indemnity. The Banque de l'Indochine invested in a number of colonial ventures such as the and the
Chemins de fer de l'Indochine et du Yunnan, It repeatedly entered new territories at the request of the French government. In July 1908, it thus established an office in
Djibouti to co-finance the
Compagnie du Chemin de fer de Djibouti à Addis-Abeba, In 1918, it opened an office in
Vladivostok to serve the Allied military base there during the
Siberian intervention. In July 1921, the
Banque Industrielle de Chine (BIDC), which had been created in 1913 to compete with the Banque de l'Indochine for the financing of French ventures in Shanghai and elsewhere in China, collapsed despite the backing it had received from the French Foreign Ministry and the BPPB. The latter acquired the BIDC's sounder assets, and the rest was managed by the Banque de l'Indochine as a
bad bank, the , and eventually restructured in 1925 as the
Franco-Chinese Bank (BFC). The Banque de l'Indochine remained a significant stakeholder of the BFC, together with the BPPB and the . and the
Société Le Nickel in
New Caledonia. It opened an office in Fort-Bayard (now
Zhanjiang) in the French
Leased Territory of Guangzhouwan on , and offices in
Cần Thơ and
Nam Định in 1926. In 1930, in coordination with the French government, the Banque de l'Indochine took the
French Indochinese piastre off the
silver standard (which it had upheld until then, alone with China which in turn abandoned it in 1935) and into the
gold standard. In 1936, the piastre was taken off the gold standard, together with the French franc to which it was kept convertible at a rate of 10 francs for 1 piastre. Throughout the 1920s, the French Parliament extended the Banque de l'Indochine's issuance privilege only for short periods of time, from 1920 to 1925 on an annual basis, and then every semester, in contrast to earlier long-term extensions. The Banque de Paris et des Pays-Bas, which by then had become the Banque de l'Indochine's major competitor, provided covert funding to advocacy efforts against further extension. On , new French legislation eventually extended the bank's issuance privilege by 25 years, against which the French state participated in a capital increase and subsequently held 20 percent of the bank's equity capital as well as extensive rights in its governance. These included six board memberships and the selection of the board chair. The French government initially kept
René Jules Thion de la Chaume, a traditional banker, as chairman of the Banque de l'Indochine, but in 1936 replaced him with a lifetime civil servant, Marcel Borduge. Also in 1931, the Banque de l'Indochine participated in the establishment of the
Bank for International Settlements in
Basel, and in a capital increase of the
State Bank of Morocco, despite the latter being under the BPPB's dominant influence.
World War II During
World War II, the Banque de l'Indochine was chaired by
Paul Baudoin, who in the summer of 1940 was the first Foreign Minister of
Vichy France. In 1941, the Banque de l'Indochine was allowed to acquire an equity stake in its rival the Banque de Paris et des Pays-Bas. The Banque de l'Indochine, like the BPPB, was subsequently able to escape
nationalization following the
liberation of France, even though Baudoin was sentenced to
Indignité nationale. In 1940 the bank established offices in
London and
Yokohama, and in November 1942 relocated the latter to
Tokyo until it closed in September 1945. Under Japanese occupation, the bank's offices in Hong Kong and Singapore ceased activity in early 1942, and those in China were reduced to near-complete paralysis. In
Pondicherry, the news of the
armistice of 22 June 1940 were met with panic and triggered a
bank run on the Banque de l'Indochine. This in turn played a role in the decision by
Louis Bonvin, Governor of
French India, to reverse his prior allegiance to
Vichy France and rally to
Free France, which allowed the bank to receive financial support from the
British Raj.
Postwar history The future of the Banque de l'Indochine was vividly debated in the new political context created by the
liberation of France. In 1945, the French government decided to revalue the
French Indochinese piastre to a rate of 17 French francs to one piastre, up from 10, a decision that initiated a bout of trafficking and corruption that would become known as the
piastres affair (); that same year, the
CFP franc replaced the piastre as the currency of French Polynesia and New Caledonia. In 1947, following protracted negotiations, the Banque de l'Indochine approved the decision to buy back the French government's 20 percent equity stake, despite a steep price imposed by Finance Minister
Maurice Schumann. Its issuance privilege was revoked in principle by a law of , but was kept in practice until March 1949 in Djibouti (replaced by direct issuance by the Treasury), December 1951 in Indochina (replaced by the
Institut d'Émission des États du Cambodge, du Laos et du Viet-nam), and March 1967 in French Polynesia and New Caledonia (replaced by the
Institut d'Émission d'Outre-Mer). Meanwhile, the Banque de l'Indochine developed its activity, as an increasingly active investment bank in France, and a retail and commercial bank internationally, both in the colonies rebranded as
French Union and in other countries, such as
South Africa. The bank's activities in mainland China were partly revived after the defeat of Japan in 1945 (as were the offices in Hong Kong and Singapore), kept for a while after the Communist victory of the
Chinese Civil War in 1949, In the
New Hebrides, now
Vanuatu, it established a branch in
Port Vila in 1948, and an office in
Luganville in the 1950s. It also opened locations in Malaysia in 1951, Tokyo (again) in 1953, and
Lausanne in 1957. Even so, Indochina still represented more than half of the bank's income in the early 1950s. In 1953, the bank opened a branch in
Vientiane,
Laos. Following the French loss of
North Vietnam following the
1954 Geneva Conference, it had to close its branches in
Hanoi on , in
Haiphong on , in
Cần Thơ on , and in
Da Lat and
Da Nang on . On , the Banque de l'Indochine sold several of its properties, including its main office building in
Saigon, to the
National Bank of Vietnam, the central bank of the newly established
Republic of Vietnam. It reorganized its remaining activities in Indochina as a Saigon-based subsidiary, the . In 1954–1955, the Banque de l'Indochine also ceased its activity in Pondicherry following the
de facto end of
French India; its branch was acquired by
Indian Overseas Bank. In 1963, its activity in
Cambodia was nationalized. By the early 1950s, the Banque de l'Indochine also had a broad network of minority stakes in other banks, including the
Banque de Paris et des Pays-Bas (acquired in 1941),
Crédit Foncier d'Algérie et de Tunisie, Banque industrielle de l'Afrique du Nord (Algeria), Banque commerciale africaine (West and Central Africa), Bank Sabbag (Lebanon), and
Franco-Chinese Bank, among others. In 1960, it took over the
Franco-Chinese Bank by purchasing the shares formerly held by Banque de Paris et des Pays-Bas and
Banque Lazard. In 1973, it converted its branches in French Polynesia into a subsidiary, the .
Merger into Banque Indosuez In 1966, to prevent an outright takeover of military-industrial concern
Schneider by Belgium's
Empain group, the Banque de l'Indochine acquired 10 percent of Schneider's capital. As a consequence of that transaction, Empain took 11 percent of the bank's own capital. Its chairman then attempted to counter Empain's influence in the bank (as the rest of the shareholder base was highly dispersed) by inviting the
Compagnie Financière de Suez, with which the bank had several common business interests, to invest in it as well. In January 1967, Suez acquired 7 percent of the bank's capital, the same amount as held by Empain by then. De Flers subsequently invited La Paternelle, an insurer, to acquire a further 4 percent of the bank's capital, thus consolidating a group of friendly shareholders. In late 1969, the Assurances du groupe de Paris (AGP), a holding company that had been formed in the meantime and owned La Paternelle, owned 22 percent of the Banque de l'Indochine, and by 1972, 45 percent. That year, AGP sold its stake to the
Compagnie Financière de Suez. In 1975, the latter merged the Banque de l'Indochine with its subsidiary the Banque de Suez et de l'Union des Mines, to form
Banque Indosuez. ==Sites==