Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
Related questions
Question
How would describe Rothschild and Co's relationship with its history ? How valuable is it ??
![For the Rothschild family, two centuries of banking experience can be useful.
In 2018, Alexandre de Rothschild became the head of
Rothschild & Co., a bank that traces its existence seven
generations back to Mayer Amschel Rothschild, born in 1743
in Frankfurt's Jewish ghetto. Alexandre was just 37 years old.
He had trained at the French École Supérieure du Commerce
Extérieur, then worked in American investment banking and
private equity, before spending a decade back in France
managing parts of the family business. Rothschild & Co. has
3,500 employees in over 50 offices around the world, with
three main businesses: Global Advisory, Wealth and Asset
Management, and Merchant Banking. The Rothschild family
owns 49 per cent of the company and controls 58 per cent
of the voting rights.
The French banking business was founded in 1812 by one
of the five sons that Mayer Amschel Rothschild originally
sent out from Germany to various countries around Europe.
Another successful son established in 1810 the London
war. The family had always been well connected in France
with the old bank having trained Georges Pompidou, French
President during the 1970s, and the new bank training
Emmanuel Macron, elected President in 2017. In 1993, Paris
Orléans won the contract for privatising the French car giant
Renault, marking its return to large-scale banking,
David de Rothschild instituted several management
principles for his bank. He promoted collegiality rather than
the internal competition common in investment banking.
He refused to act for comnpanies engaged in hostile or
predatory takeovers. Unlike similar boutique banks, he did
not offer senior managers any shares. For him, all this was
important to the family nature of the business.
At the same time, from 2002 onwards, the Parisian and
London Rothschild banks began to cooperatemore, sharing ut
markets as 'Groupe Rothschild. In 2012, the two banks merged
completely, under the leadership of David de Rothschild.
In 2015, the banking name of Paris Orléans was replaced by
Rothschild & Co. Its logo was a shield with five arrows, repre-
bank that funded the British war against Napoleon in this
period (the other sons established banks in Austria, Italyand
Switzerland). However, the French business suffered two
major blows in the twentieth century: first Nazi persecution
forced the family to flee to New York during the war, second,
the election of Francois Mitterand as French President led to
the bank's nationalisation in 1981. The head of the bank Guy
de Rothschild is often quoted as saying in the 1980s: 'First
Jewish under Pétain (the French President who collaborated
with the Nazis); now pariah under Mitterand. That is enough
for me.' Guy de Rothschild retired from banking, going back
to the United States in disgust.
senting the five sons of Mayer Amschel Rothschild.
Under the leadership of Alexandre de Rothschild, the
merged bank looked set to do more in the world of high
technology. However, Rothschild & Co's website in 2018
states clearly: 'As a business controlled by certain members
of the English and French Rothschild families, we have always
been driven by the Rothschild family motto "Concordia,
Integritas, Industria" [consensus, integrity and hard work].
Sources: Les Echos, 16 April 2018; Financial Times, 30 June 2018; www
rothschildandco.com
However, in 1984 his son David de Rothschild established
a small specialised bank in France under the name of Paris
Orléans, an old company that the family had owned since
the mid-nineteenth century. He had very little capital and
a staff of just ten, including his cousin who had returned
from a finance career on Wall Street. However, David de
Rothschild was supported by the head of the London
Rothschild bank, Evelyn de Rothschild, as well as by various
prominent French businessmen, including the head of a
Marseille bank that had helped the Rothschilds during the](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F5b1f029f-f5d2-4357-b587-d55dd23f7d81%2F16c3ace3-e109-46dc-a990-8e5cac846fc2%2Fd0u54np_processed.jpeg&w=3840&q=75)
Transcribed Image Text:For the Rothschild family, two centuries of banking experience can be useful.
In 2018, Alexandre de Rothschild became the head of
Rothschild & Co., a bank that traces its existence seven
generations back to Mayer Amschel Rothschild, born in 1743
in Frankfurt's Jewish ghetto. Alexandre was just 37 years old.
He had trained at the French École Supérieure du Commerce
Extérieur, then worked in American investment banking and
private equity, before spending a decade back in France
managing parts of the family business. Rothschild & Co. has
3,500 employees in over 50 offices around the world, with
three main businesses: Global Advisory, Wealth and Asset
Management, and Merchant Banking. The Rothschild family
owns 49 per cent of the company and controls 58 per cent
of the voting rights.
The French banking business was founded in 1812 by one
of the five sons that Mayer Amschel Rothschild originally
sent out from Germany to various countries around Europe.
Another successful son established in 1810 the London
war. The family had always been well connected in France
with the old bank having trained Georges Pompidou, French
President during the 1970s, and the new bank training
Emmanuel Macron, elected President in 2017. In 1993, Paris
Orléans won the contract for privatising the French car giant
Renault, marking its return to large-scale banking,
David de Rothschild instituted several management
principles for his bank. He promoted collegiality rather than
the internal competition common in investment banking.
He refused to act for comnpanies engaged in hostile or
predatory takeovers. Unlike similar boutique banks, he did
not offer senior managers any shares. For him, all this was
important to the family nature of the business.
At the same time, from 2002 onwards, the Parisian and
London Rothschild banks began to cooperatemore, sharing ut
markets as 'Groupe Rothschild. In 2012, the two banks merged
completely, under the leadership of David de Rothschild.
In 2015, the banking name of Paris Orléans was replaced by
Rothschild & Co. Its logo was a shield with five arrows, repre-
bank that funded the British war against Napoleon in this
period (the other sons established banks in Austria, Italyand
Switzerland). However, the French business suffered two
major blows in the twentieth century: first Nazi persecution
forced the family to flee to New York during the war, second,
the election of Francois Mitterand as French President led to
the bank's nationalisation in 1981. The head of the bank Guy
de Rothschild is often quoted as saying in the 1980s: 'First
Jewish under Pétain (the French President who collaborated
with the Nazis); now pariah under Mitterand. That is enough
for me.' Guy de Rothschild retired from banking, going back
to the United States in disgust.
senting the five sons of Mayer Amschel Rothschild.
Under the leadership of Alexandre de Rothschild, the
merged bank looked set to do more in the world of high
technology. However, Rothschild & Co's website in 2018
states clearly: 'As a business controlled by certain members
of the English and French Rothschild families, we have always
been driven by the Rothschild family motto "Concordia,
Integritas, Industria" [consensus, integrity and hard work].
Sources: Les Echos, 16 April 2018; Financial Times, 30 June 2018; www
rothschildandco.com
However, in 1984 his son David de Rothschild established
a small specialised bank in France under the name of Paris
Orléans, an old company that the family had owned since
the mid-nineteenth century. He had very little capital and
a staff of just ten, including his cousin who had returned
from a finance career on Wall Street. However, David de
Rothschild was supported by the head of the London
Rothschild bank, Evelyn de Rothschild, as well as by various
prominent French businessmen, including the head of a
Marseille bank that had helped the Rothschilds during the
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