The Reorganisation of Banca Commerciale Italiana’s US Network (1935–1941)

Throughout the Interwar period, Banca Commerciale Italiana’s (BCI) foreign network underwent a gradual reorganisation, a process that intensified in the 1930s. This acceleration followed the 1931 banking crisis and the introduction of Fascist policies on capital and exchange controls, which restricted Italian financial institutions from purchasing foreign currencies. Similarly, international players were prevented from speculating on the lira, with exceptions granted only for the manufacturing sector and subject to authorisation from the National Institute for Foreign Exchange (INCE).

Focusing on the US branches of BCI, these operations were significantly affected by the crises and policies of the time. The New York branch – with its four city agencies in Manhattan, Harlem, Brooklyn, and Long Island – was established shortly after World War I, followed in 1924 by the opening of two additional agencies in Boston and Philadelphia. These branches primarily served to collect deposits and savings from local Italian immigrant communities and facilitate remittances. Following the new banking regulations introduced in the 1920s, the three branches operated as US-registered companies under the name Banca Commerciale Italiana Trust Company (of New York, Boston, and Philadelphia). By the late 1920s, archival evidence shows that the New York branch had become the principal centre, among the other BCI agencies, of acceptance business, thus highlighting an effort to acquire a standing beyond that of a deposit bank, although not yet comparable to its London counterpart. In 1935, BCI’s central management dispatched a new managing director to oversee the restructuring of the US branches, which were facing a severe crisis for manifold reasons. Among the main challenges were the negative effects of the Great Depression on Italian immigrant communities and, specifically in Boston, intense competition from Credito Italiano (another Italian bank), which had strengthened its ties with the First National Bank of Boston at the expense of BCI. After three years of restructuring, BCI consolidated its US operations in 1938 by centralising activities in the New York Trust. The other city agencies were closed, and the Trusts of Boston and Philadelphia were liquidated. Under the new directives from BCI central management in Milan, the New York Trust shifted its focus to foreign correspondence banking, serving, in fact, as a correspondent for its Italian and European affiliates, as well as BCI’s South American subsidiaries. Notably, these included Banque française et italienne pour l’Amérique du Sud, Banco Italiano di Lima, and Banco Italiano di Guayaquil. This new role aligned the New York Trust with the functions carried out by the BCI’s London branch.

The aim of this paper is to explore in greater depth this reorganisation process and examine how the BCI Trust of New York achieved surpluses to finance short-term international trade, giving a first all-encompassing analysis of the evolution of its business during the Interwar. In the context of the challenging international economic scenario and the fascist economic and monetary policies of the 1930s, this paper will focus on how the New York Trust became a key point of reference for BCI’s South American affiliates between 1935 and 1941, the year that marked the closure of the New York operations due to the United States’ entry into World War II. This study leverages newly available primary sources from the Intesa Sanpaolo historical archive, which have already enabled the creation of a unique dataset covering the credit lines extended by BCI’s New York and London branches to their clients and sister banks between 1935 and 1941.

Federico Castelli

PhD candidate in banking history at the department of Historical studies of University of Milan and LEREPS, University of Toulouse. Supervisor: Germano Maifreda (University of Milan), full professor of economic and business history; co-supervisor: Stefano Ugolini (Université Toulouse I - Capitole), associate professor of economics.

My research examines the operations of the London and New York branches of Banca Commerciale Italiana (an Italian universal bank) during the interwar period from three distinct perspectives. First, it explores the governance of these branches by analysing the social networks of their directors. Second, it investigates the evolution of business volume throughout the 1930s, with a particular emphasis on the role of acceptances in financing international trade. Finally, it assesses the impact of financial sanctions imposed by the League of Nations after the Ethiopian War (1935) on the Italian economy.