T H E H I S T O R Y O F A G L O B A L F I N A N C I A L G R O U P

This enabled the bank to expand its corporate business but it became over-involved with some of its clients and went out of business when the 1930s recession struck. The bank was re-established in 1932 under the name of Banque Nationale pour le Com- merce et l Industrie (BNCI). It was spearheaded by the highly-talented Alfred Pose, who was appointed Managing Director at the age of just 33. The bank made its mark with its dynamic commercial approach and its innovative way of processing transactions with the establishment in 1934 of back offices specialised processing centres. Meanwhile Paribas, under its Managing Director Horace Finaly, revived the bank s partnerships with industry, especially the oil industry, and strengthened its presence in Central Europe, where it represented French interests.

1945-1966: a period of modernisation

Following the sharp drop in business during World War II, when the banks networks abroad had been cut off from their Paris head offices, the Group forerunner banks began to direct their efforts towards reconstruction. In 1945 banking legislation was passed which separated merchant and investment banks from commercial banks and the government nationalised the four largest financial institutions to help the country get back on its feet economically. CNEP and BNCI were nationalised, and opted for deposit bank status. CNEP continued along a cautious path while BNCI, which since the war had been building up a broad international network, was still proving to be both competitive and innovative, inter alia becoming in 1954 the first bank to advertise on the radio. New products such as personal loans (1959), and SICAV unit trusts (1963) were offered to customers.

Paribas chose to take merchant bank status and was not among the four nationalised banks. It achieved fame after the war through its financing of major international projects that supported French industrial exports, such as the Paz del Rio steelworks (1950) in Colombia. Under the management of Jean Reyre, Paribas reasserted its ambitions on the international, particularly European, scene. The bank forged new alliances, was instru- mental in the introduction of buyer credits for trade finance in 1965 and also played a pioneering role in the Eurocurrency market which was emerging at that time.

1966: a key year in the development of the Group

As part of a wide-ranging plan to kick-start the French economy, the Minister of Economy and Finance, Michel Debré, wanted to stimulate competition between banks and create a financial strike force . He softened the distinction between merchant/investment banks and deposit-taking banks and eased restrictions on the opening of new branches. In 1966 he merged BNCI with CNEP to form Banque Nationale de Paris (BNP), which became the leading bank in France. The good relations between Henry Bizot, Chairman of CNEP, and Pierre Ledoux, Managing Director of BNCI, helped to ensure a successful merger of the two banks which, although highly complementary, had widely differing corporate cultures.

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