Die Geschichte der National-Bank, 1921 bis 2011 by Joachim Scholtyseck (review)

In the 1990s German firms began opening their archives to a critical study of their activities under the Third Reich. The Deutsche Bank, Germany’s largest financial institution, was the first to do so, and others soon followed. By the end of the decade Chancellor Gerhard Schröder had established the “German Companies Foundation Initiative” to acknowledge the responsibility that German businesses bore for the crimes of National Socialism. The movement for more corporate transparency about complicity with the Third Reich was underway.

Many German enterprises were slow to get on board, including the National-Bank, an important regional institution in Essen. In 1998 the National-Bank still blocked access to its archive, and only a few internal chronicles recorded its history. To commemorate its ninetieth year in 2011, however, the National-Bank gave Joachim Scholtyseck complete archival access to write a history of the bank. Scholtyseck has drawn on internal bank documents, regional and federal archives, as well as interviews to construct not merely a case study, but rather a nuanced story that embeds the National-Bank’s evolution in the regional history of Essen as well as the financial history of Germany. Scholtyseck recounts how the macroeconomics of the Great Depression, the party politics of Essen under the Nazis, and the structural crises of the 1970s shaped the bank’s development, tracing changes in the bank’s management and lending practices across three political eras: the Weimar Republic, the Third Reich, and the Federal Republic.

What emerges is a portrait of the National-Bank as atypical among Germany’s financial institutions. Founded in 1921 as the Vereinsbank für deutsche Arbeit AG, and soon renamed the Deutsche Volksbank (DVB), it became Germany’s first employee-focused bank. While the universal banks of Berlin financed big industry, and the smaller savings banks financed Germany’s Mittelstand, the DVB provided savings accounts to the “little people” (389) and the working classes, and extended cheap credit to cooperative enterprises. Indeed, in the 1920s the DVB was a political institution: the Central Federation of Christian Trade Unions owned most of its equity, and the bulk of its customers came through connections with the Christian Unions. Yet this undiversified clientele nearly undid the bank. When depression struck at the end of the 1920s and unemployment among Germany’s working classes rose, the DVB suffered massive losses and barely avoided collapse following a weak rescue effort in 1931.

Scholtyseck suggests the DVB might have survived the depression by continuing with its existing business model, although here he remains inconclusive. But with Adolf Hitler’s seizure of power, the bank embarked on a new business model. Local Nazi party members—Essen Gauleiter Josef Terboven and journalist Wolfgang Müller-Clemm—pushed out the old management, expropriated the Christian Trade Unions’ equity for the Nazi’s own union (Deutsche Arbeitsfront, or DAF), renamed the DVB the National-Bank AG, and most important, turned it into a regional institution to serve Essen. Under Nazi patronage the bank benefited considerably, participating as a junior partner in the “Aryanization” of one of Essen’s oldest Jewish-owned banks, and even earning distinction as a “model enterprise of National Socialism” (183).

With the collapse of the Third Reich the National-Bank severed its connections with the Nazi Party, but continued to develop the regional business model adopted during the 1930s, fully jettisoning its founders’ goals of serving trade unions. During Germany’s economic miracle it pursued a conservative lending strategy—“efficiency before growth” (338)—that stood it in good stead in the coming decades. In contrast to other local banks, the National-Bank did not invest heavily in coal, Essen’s economic treasure before 1970 and its albatross after 1980. Instead, it financed the region’s service sector and its housing and construction markets. The oil crisis of the 1970s barely harmed the National-Bank, since its main clientele had by then become Essen’s...