NOTES ON THE RHINELAND CHEMICAL WORKS. ; 
very recent date the six leading German banks controlled a capital of 
£137,000,000, whilst the whole English banking system, excluding the 
Bank of England, holds a paid-up capital and reserve of £110,500,000. 
It is held as a standard of British banking, as voiced by a late presi- 
dent of the Bankers’ Institute, that ‘a banker should never be a 
partner,” but exactly the opposite is the general rule in Germany. From. 
the underwriting necessary at the flotation of a new company, or to 
increase the capital of an old one, the bank is predominant and retains 
its interest in the new or old concerns with which it is thus associated, 
much to the benefit of the enterprise. Georges Lachapelle states that 
in 1911 the Deutsche Bank was represented on 134 different boards, the 
Disconto on 114, and the Dresdner on 112. <A statement by W. R. 
Lawson is of more value in this connection than mine. He says, 
“German banking does not stand aloof from industry, as ours does. 
The men who direct the German banks are at all times in close touch 
with the iron and coal industries, the manufacturing and trading 
classes, and the ocean steam lines. With them finance, industry, and 
transportation go hand in hand and are regarded as integral parts of 
the same problem. The German banker has a finger in everything that 
is going on. He is represented directly or indirectly on the boards of 
manufacturing, trading, shipping, and mining companies. He has his 
eyes on all the staple markets. Underwriting is one of his recognised 
functions, and Germany is thereby spared many of the scandals of 
British company promoting. There are few commercial or industrial 
rman ventures, be they private concerns or joint stock companies, 
which do not have at their disposal a fixed credit, uncovered, or covered 
by very unliquid securities, with one or more banks. Not only have 
the banks promoted most of the industrial joint stock companies and 
retained part of their share capital, but their managing directors re- 
main members of the boards of these companies and draw personally 
large salaries for their services in this capacity.” 
German industrial enterprise owes a very great part of its success 
to this close association with the national banking interest, for the 
directors of these banks see to it that any appeal for public money with 
which they associate themselves shall be fully and satisfactorily re- 
ported upon by their large staff of industrial experts, and that their 
arrangements as to capital, management, and scientific assistance are 
approved by the highly-trained men on their boards. It leaves no ques- 
tion for doubt that such co-operation is a prime factor in the success of 
German industries in home and particularly foreign trade. An enter- 
prise abroad, financed by a German bank, is compelled, as a part of the 
financial agreement, to place all orders for materials with German firms, 
and most generally firms in which the bank has a financial holding. 
In the light of all this, the system of extended credits which have 
been so prominent a feature of German foreign business need only be 
mentioned to be understood. 
So far we have discussed conditions which affect many others be- 
sides the chemical industries, and we may now consider some which are 
more particularly attached to this special variety of industrial enter- 
prise. We have already said that the demand for men having exceptional 
training in chemical and allied sciences has always been fully met by 
C.2007.—5 113 
