Creditanstalt

This article is about the Austrian bank founded in 1855. For other entities named Creditanstalt or Kreditanstalt (lit. 'credit institution'), see Kreditanstalt.

Creditanstalt AG

Creditanstalt head office during the 1920s and early 1930s on the Freyung, in 2014 as Bank Austria Kunstforum
Industry	Financial services
Founded	1855
Founder	Anselm von Rothschild
Fate	Merged with Bank Austria in 2002
Successor	Bank Austria-Creditanstalt
Headquarters	Vienna, Austria
Website	www.ba-ca.com

The Creditanstalt (sometimes Credit-Anstalt, abbreviated as CA), full original name k. k. priv. Österreichische Credit-Anstalt für Handel und Gewerbe (lit. 'Imperial & Royal privileged Austrian Credit Institution for Commerce and Industry'), was a major Austrian bank, founded in 1855 in Vienna.

From its founding until 1931, the Creditanstalt was led by members of the Rothschild family, who were among its significant shareholders. Its historically consequential failure in 1931 led to a merger engineered by the Austrian government in 1934, in which it combined with the Wiener Bankverein and the sound parts of the Niederösterreichische Escompte-Gesellschaft to form Österreichische Creditanstalt - Wiener Bankverein, in short Creditanstalt-Bankverein. The latter came under the control of Deutsche Bank following the Anschluss in 1938, was nationalized in 1945, and was eventually acquired in 1997 by Bank Austria to form Bank Austria-Creditanstalt, since 2005 a subsidiary of UniCredit. UniCredit phased out the Creditanstalt brand in 2008.

Foundation and development until 1931

Advert of Creditanstalt's creation in Wiener Zeitung, 6 November 1855, with mention of Max Egon zu Fürstenberg, Johann Adolf II. zu Schwarzenberg, Vincenz Karl von Auersperg, Otto Ferdinand von Chotek, and Louis Haber von Linsberg among the founders

Share certificate of the Credit-Anstalt für Handel und Gewerbe, issued 31 March 1858

The Creditanstalt was founded in 1855 by Anselm Salomon von Rothschild, Salomon Mayer's son, with support from Austrian finance minister Karl Ludwig von Bruck and from notable figures of the Bohemian high nobility. It was inspired by the Pereire brothers' Paris-based Crédit Mobilier (est. 1852), and represented a defensive move against the Pereires' aggressive expansion into Europe in competition with the long-established Rothschilds. It immediately became the leading bank in the Habsburg Monarchy. Albert Salomon Anselm von Rothschild, Anselm's son, took control of the Creditanstalt in 1872, and was in turn succeeded in 1911 by his son Louis Nathaniel de Rothschild.

The CA's circumstances were dramatically affected by Austria-Hungary's defeat in the First World War, the dissolution of the Habsburg empire, and the formation of the First Austrian Republic. It lost most of its former operations outside the new Republic in the newly created countries of Central and Eastern Europe. In 1919, it had to sell its operations in what had become Czechoslovakia to the Prague-based Böhmische Escompte-Bank. Instead, the Creditanstalt expanded domestically. It purchased the Austrian Union-Bank, then in 1926 the Viennese operations of Anglo-Austrian Bank which had become a British bank following recapitalisation by the Bank of England. In 1929, just at the time of Wall Street Crash and under pressure from the Austrian government led by Johann Schober, it purchased its distressed peer the Allgemeine Bodencreditanstalt.

Bankruptcy

Burdened by the troubled legacy of the Boden-Creditanstalt, the Creditanstalt declared bankruptcy on 11 May 1931. This was one of the first major bank failures that initiated the Great Depression. Chancellor Otto Ender organized a rescue that entailed cost-sharing by the Austrian government, the Oesterreichische Nationalbank, and the Rothschild family, rejecting nationalization plans advocated by the Social Democratic Party. Even so, the bank was de facto state-owned after Chancellor Engelbert Dollfuß in 1934 ordered the Creditanstalt's merger with the Wiener Bankverein and the Niederösterreichische Escompte-Gesellschaft, after which the merged entity was known as Creditanstalt-Bankverein. The CA's bankruptcy and its impact in producing a major global banking crisis provided a major propaganda opportunity for Adolf Hitler and the Nazi Party, allowing them to further blame Jews for German and international economic and social troubles.

Anschluss and World War II

Following the Austrian Anschluss to Nazi Germany in 1938, Creditanstalt-Bankverein was targeted for both financial and racial reasons. Louis de Rothschild was immediately arrested and imprisoned for the losses suffered by the Austrian state when the bank had collapsed. Deprived of his position and property, he was released upon payment of $21,000,000, believed to have been the largest bail bond in history for any individual, and migrated to the U.S. in 1939 after more than one year in custody.

Later in 1938, the Creditanstalt-Bankverein was taken over by Deutsche Bank, which immediately owned a 25 percent stake and raised it to majority control in 1942. During wartime, the Creditanstalt expanded its operations into Nazi-occupied Czechoslovakia, Poland, and Yugoslavia. Even though its CEO Josef Joham made contact with the U.S. Office of Strategic Services, the Creditanstalt in that period settled the financial issues of several Nazi concentration camps as well as the Aryanization of Jewish-owned businesses, like the re-establishment of Sascha-Film as Wien-Film Limited.

Postwar development

Following Nazi defeat in World War II, the Creditanstalt again had to refocus its activity on Austria, and was nationalized by Allied-occupied Austria in 1946. It became mainly a commercial bank and was involved in Austria's economy, holding stakes in important Austrian companies such as Wienerberger, Steyr-Daimler-Puch, Lenzing AG, and Semperit. From 1956 onwards, the Creditanstalt was partly privatized by issuing 40% in shares, though only 10% in common stock. From the 1970s, it restarted an international expansion into central and eastern Europe.

In 1981, the former Social Democratic Minister of Finance Hannes Androsch assumed the office of a general manager, after he had left the cabinet led by Bruno Kreisky. The bank's investments into industrial interests were reduced, while the government's ownership share fell to 51%. In the 1980s, the Creditanstalt opened branches in London, New York and Hong Kong. From 1989 onwards, its international orientation towards East-Central Europe was boosted by the fall of the Iron Curtain. In 1997, Geoffrey Hoguet ceased to work for the investment bank, the last member of the Rothschild family employed in banking in Austria by then.

Merger with Bank Austria and aftermath

In 1997, the Austrian government sold its majority ownership stake in Creditanstalt to Bank Austria (BA), triggering a crisis in the ruling coalition between the Social Democratic Party and the Austrian People's Party - since the Creditanstalt was considered to be part of the Austrian People's Party's sphere of influence under the country's distinctive Proporz arrangement, whereas both of Bank Austria's predecessor entities, the Länderbank and the Viennese Zentralsparkasse, were associated with the political left. In 2001, Bank Austria in turn was acquired by Germany's HypoVereinsbank (HVB), which merger it with Creditanstalt in 2002 to create Bank Austria Creditanstalt (BA-CA). In 2005, HVB was taken over by Italy's UniCredit. After 153 years, the Creditanstalt brand name was finally phased out in 2008, even though it survived in a property subsidiary named CA Immo.

Buidlings

In 1855, the Creditanstalt was temporarily established at Renngasse 1 on Vienna's Freyung square. In 1858, the Creditanstalt purchased and demolished a number of houses on am Hof square in central Vienna and replaced them with a new building designed by architect Franz Fröhlich, with allegorical sculptures by Hans Gasser representing Navigation, Railways, Commerce, Industry, Agriculture, and Mining. The building, numbered am Hof 6, was completed in 1860 and was kept in use by Creditanstalt until the 1934 merger. It was subsequently purchased by the Österreichischen Realitäten AG property firm, and in 1940 by the Steierische Baugesellschaft. Am Hof 6 was damaged by allied bombing on 10 September 1944 and subsequently demolished. A new building was erected in its place in the early 1950s for electricity utility Verbundgesellschaft, designed by architect Carl Appel.

Between 1915 and 1921 the Creditanstalt had its head office expanded northwestward across Tiefer Graben street, on a land plot bordering the Freyung that it had purchased in 1914 from Niederösterreichische Escompte-Gesellschaft, which itself was moving from there to its new headquarters on am Hof 2. The opulent neoclassical extension, linked to the former seat by a bridge over Tiefer Graben, became the bank's main headquarters. It was designed by architects Ernst Gotthilf and Alexander Neumann; the same team had previously created the new head offices of Creditanstalt's competitors the Wiener Bankverein (on Schottentor) and the Niederösterreichische Escompte-Gesellschaft itself (am Hof 2), both nearby locations. Following the 1934 merger, the building was purchased in 1937 by Österreichische Versicherungs-AG, an insurance company. By 1980 it was the property of the Länderbank which used it for its Länderbank Art Forum, successively renamed Bank Austria Art Forum (1991-2002), BA-CA Kunstforum (2002-2008), and since 2008 again Bank Austria Art Forum Vienna. In 2010, it was acquired by financier René Benko, who repurposed its northwestern wing which became the seat of the Austrian Constitutional Court in 2012, whereas the art forum has remained on the southeastern side.

In 1934, the Creditanstalt-Bankverein established its head office in the former seat of Wiener Bankverein at Schottentor. It remained there through the multiple mergers and restructurings until the late 2000s.

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  The Creditanstalt's first head office on Renngasse 1
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  Head office building erected 1860, am Hof 6, photographed ca. 1900
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  The 1910s extension in 2014, with the Austrian Constitutional Court on the left and Bank Austria Art Forum on the right
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  Monogram of the Creditanstalt ("CAfHuG" for Credit-Anstalt für Handel und Gewerbe) on the 1910s extension
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  Former Wiener Bankverein seat at Schottentor, head office of Creditanstalt-Bankverein from 1934
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  Branch building in Innsbruck, Maria-Theresien-Straße 36, in 2019
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  Branch building in Graz, Herrengasse 15, in 2014
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  Branch building in Salzburg, Rainerstrasse 2, in 2016
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  Branch building in Villach, Hauptplatz 18, in 2021
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  Former branch office in Prague, Na příkopě 8, designed by architect Emil von Förster with sculptures by Antonín Popp, built in 1894-1896

See also

• Anglo-Austrian Bank
• Erste Group
• List of banks in Austria

Further reading

• März, Eduard, Austrian Banking and Financial Policy: Credit-Anstalt at a Turning Point, 1913–1923 (Basingstoke: Palgrave Macmillan, 1984) ISBN 978-0-312-06124-1
• Schorske, Carl E., Fin-de-Siècle Vienna: Politics and Culture (London: Vintage, 1980) ISBN 0-394-74478-0
• Schubert, Aurel, The Credit-Anstalt Crisis of 1931 (Cambridge: Cambridge University Press, 1992) ISBN 0-521-36537-6

External links

• Official website
• Clippings about Creditanstalt in the 20th Century Press Archives of the ZBW