Banque de l’Indochine first made its presence in Southeast Asia in 1875 with the opening of its branch in Saigon, Vietnam. Banque Indosuez was the official name for the bank in 1981. Initially set up as a note-issuing bank in French Indochina, it quickly expanded to serve French settlements in Oceania, New Caledonia, French Somaliland, and other parts of Asia outside French influence. Apart from Singapore’s strategic location between East-West trade routes, other factors also prompted the setting up of a new branch in Singapore. The opening up of the Suez Canal in 1869, technical innovation of steamships and more significantly, the signing of the Anglo-French Entente Cordiale treaty in 1904 made it lucrative for French foreign companies to conduct commercial activities in Singapore. Under these favourable circumstances, the first French bank in Singapore was opened on 1 March 1905.1
Banque de l’Indochine’s first branch in Singapore was at 31 Raffles Place. The landlord was Mr Sarkies, the proprietor of the Raffles Hotel. Previously, colonial laws had prohibited non-registered foreign companies from purchasing or renting properties. This changed with the enactment of the Banque de l‘Indochine’s Ordinance. The branch manager for Saigon, Mr Hosset, was tasked to find a suitable location for the branch in Singapore and make the necessary preliminary arrangements, signed the lease. An initial deposit of 30,000 Straits dollars was paid to cover the rent. The bank’s office design included a reinforced concrete strong-room, an exterior balcony to protect customers from the environment and a plaque engraved with the bank’s name. In 1912, two years before the expiry of the lease of 31 Raffles Place, the bank decided to buy the building at the corner of D’Almeida and Malacca Streets (2 D’Almeida Street) for 140,000 Straits dollars. The building was pulled down to make way for the construction of the bank. Banque de L’Indochine occupied the building until 1959. The bank leased out parts of the building to tenants: the basement was rented to Société Michelin for the storage of tyres; the first floor was let out to Fraser & Neave, the second floor was leased to a stockbroker; and the third floor was occupied by Messageries Maritimes. After 1959, the bank moved to Nanyang Building in Robinson Road where it remained until 1975. In September 1975, the bank moved to nearby Shenton House.2
The Early Banking Scene in Singapore
During the 19th and beginning of the 20th centuries, a number of foreign and Chinese banks were set up. Banque Indosuez was said to be the fifth oldest bank in Singapore and the only French bank until recent decades.3 In those days, the Chinese played an important role in the financial system. Local customers preferred to deal with Chinese financiers who spoke their language and were familiar with their customs and lifestyles. In addition, compared with foreign banks, Chinese banks and moneylenders were also easier sources of funds for small merchants. This posed strong competition for foreign banks which, like many other foreign banks, had to rely on the comprador system. This system employed Chinese businessmen to act as intermediaries between the bank and the customer. A comprador (Portuguese for buyer) acted as a highly trusted intermediary between the bank and the local businesses. He usually had a good amount of collateral that he could pledge to attract clients to the bank, and made his earnings through commission.4 The comprador was also in charge of the cash department and tellers in the branches, checking against fraud and losses. As a result, most people working in the cash department were either related or loyal to the comprador.
From 1930–1939, the Straits Settlement colony did well despite facing world recession which impacted the West more than the East. During this period, the bank received patronage from French trading houses and agents such as Maison Clouet, Anglo French Trading Company, Société Optorg (agent of Chargeues Réunis), Messageries Maritimes, Société d’Oxygène et d‘Acetylène (SOXAL), Société Michelin and S.M.P.T. Some of these companies were attracted by the thriving rubber industry in the region. Société Michelin and S.M.P.T, for instance, were looking to import tyres and transport Michelin-processed rubber from Indochina and Malaya, whereas Messageries Maritimes, Moine et Comte, Clouet, Denis Freres, Optorg, Le Mercier and Chargeurs Réunis were French trading or shipping companies which had branches in Singapore before 1905. Their businesses mainly composed of trade transactions between Indochina and France. The two key imports from Indochina were rice and coal. Coal was a vital commodity for steamships and ships needed to replenish their stock in Singapore before continuing their journey to Indochina. This applied, in particular, to long trips from Europe. Apart from servicing French commercial enterprises, the French bank also served the local business community. Local figures such as Dr Lim Boon Keng, Tan Boon Liat, owner of the Rattan Trading Company, and Chew Joo Chiat, a rich landowner, were loyal patrons of the bank. Banque Indosuez was then known for its financing of import and export trades, links with countries in the region, as well as its close ties with European shipping and trading companies.5 Despite its earlier good fortunes, the bank was forced to close during the Japanese Occupation. Staff members, who were part of the allied resistance, were imprisoned in Changi jail. 6
The bank did not reopen until 1945. After the war, the decolonisation of Indochina led to a reduction of trade activities between Singapore and Indochina. This affected the branch’s business transactions and profitability considerably. Despite this, the focus of the bank remained unchanged – to finance Chinese and Western firms trading in Southeast Asia. In the late 1960s to the early 1970s, the bank expanded its activities to include new financial services for the local industries. The Asian dollar market provided the impetus for the bank to begin a joint venture in merchant banking with a new company in October 1974. This new company was associated with Morgan Grenfell of London and the Development Bank of Singapore. A year later, Banque de L’Indochine merged with Banque de Suez et de L’Union des Mines. The merger brought together Banque de Suez’s merchant banking skills and its established European presence, and Banque de L’Indochine’s capacity as an established commercial banking enterprise and its established networks in Asia and the Middle East.7 This move prepared the bank to face the modern challenges ahead. In 1981, the bank’s name was shortened to Banque Indosuez.
More Recent Developments
Banque Indosuez received its operational headquarters status in October 1991 as part of its plans to beef up its regional treasury operations, project financing, equities and commodities markets activities. It had already started decentralising its operations early that year. Singapore was chosen as the Asian regional headquarters for its banking services, and this marked a significant departure from the practices of other offices in Europe, the United States and the Middle East that still reported to the Paris headquarters.8 Banque Indosuez remained the only French bank, and one of the few foreign banks with a full banking license in Singapore. This means that the bank is authorised to conduct all kinds of banking operations including the collection and remuneration of Singapore dollar deposits and domestic lending. In 1995, Banque Indosuez, together with Compagnie De Suez and Socete Generale de Belgique, set up an investment holding company in Singapore named Suez Asia Holdings to invest and manage US$200 million of its funds in Asia. It invested principally in unlisted companies and development capital in the Asia Pacific region. Lew Syn Pai, former Member of Parliament for Tanglin, was appointed the general manager of the Singapore branch of Indosuez in June 1995 – the first Singaporean to head the French bank in the Republic. Lew was formerly the assistant secretary-general and executive director of NTUC Fairprice.9
After 91 years of operations, Banque Indosuez was acquired by Credit Agricole in 1996 in a move to increase the latter’s institutional presence.10 This took place two years after Credit Agricole, France’s largest bank and the country’s farmer union celebrated its 100th anniversary. The bank then changed its name to Credit Agricole Indosuez. In 2004, Credit Agricole Indosuez merged with the investment banking division of Credit Lyonnais, that Credit Agricole had acquired in 2003 to form Calyon.11
1. Banque Indosuez, A French Bank in Perspective: 1905–1985 Banque Indosuez in Singapore (Singapore: Banque Indosuez, 1985), 2, 7. (Call no. RSING 332.12 BAN)
2. Banque Indosuez,French Bank in Perspective, 7–10.
3. Banque Indosuez,French Bank in Perspective, 2.
4. Banque Indosuez,French Bank in Perspective, 17–18.
5. Banque Indosuez,French Bank in Perspective, 3.
6. Banque Indosuez,French Bank in Perspective, 26.
7. Ho Min Fong, “Banks Merge to Boost Investments,” Straits Times, 4 October 1975, 13. (From NewspaperSG)
8. Koh Bee Ann, “Banque Indosuez Gets Operational Headquarters Status,” Straits Times, 21 October 1991, 40. (From NewspaperSG)
9. Soh Tiang Keng, “Suez Group to Launch Investment Holding Company in Singapore,” Business Times, 4 April 1995, 24. (From NewspaperSG)
10. “Control of Banque Indoseuz to Pass to Credit Agricole,” Business Times, 1 May 1996, 10. (From NewspaperSG)
11. Talla Krishnakumar, “French Bank Calyon Eyes S’pore Expansion,” Business Times, 17 July 2004, 8. (From NewspaperSG)
The information in this article is valid as of 2016 and correct as far as we are able to ascertain from our sources. It is not intended to be an exhaustive or complete history of the subject. Please contact the Library for further reading materials on the topic.