How To Survive Revolutions

While 1,000 guests banqueted on Mexican delicacies last week at the fashionable Hotel Maria Isabel in Mexico City, a small group of men spread out far to the south into the vastness of Yucatan and Quintana Roo. Banqueters and scouts had something in common: the Bank of London and Mexico, Mexico's oldest bank. The guests were celebrating the bank's 100th birthday and ogling a group of visitors that included four Cabinet members. The scouts were hard at work searching for new bank sites in the sparsely populated southeast, thus demonstrating the determination that has helped their bank survive half a dozen revolutions.

Founded by Englishmen William Newbold and Robert Geddes (the British ownership was severed in 1897), the bank opened its doors amid the civil war raging between the foreign-import Emperor Maximilian and Mexican Revolutionary Benito Juarez. Remarkably, it succeeded in winning the business of merchants and spreading into several branches, partly because it adopted the still-popular British stance of doing business with both sides and partly because its peso notes became Mexico's first nationwide paper currency. (The bank's 20-peso note shows Benito Juarez, Mexico's 33rd President, and Bartolome de las Casas, the Dominican "Protector of the Indians.") In 1913, Rebel Leader Pancho Villa raided the bank's Torreon branch and took more than 150,000 pesos; later that year the revolutionary forces of Victoriano Huerta robbed the Durango branch of 100,000 pesos. A few years later, when the bank's entire executive staff refused to hand over all its gold and silver bars to President Venustiano Carranza, he jailed them and virtually closed the bank for five years.

Calmer times have brought the bank both prosperity and prestige. Today it has assets of $244 million, which make it Mexico's third largest bank, and its 299,812 customers are served by 104 branches. Although generally regarded as conservative, the bank has moved into Central and South America, actively pushes loans to Mexico's impoverished farmers--a field that Mexico's 114 other commercial banks are usually reluctant to plow. "Agriculture credit is a good operation if you study the farmer," says Managing Director Fernando Gonzalez. He insists that his bankers not only advise farmers what to grow, but also what seed and fertilizer to use. Director Gonzalez is known affectionately in banking circles as "un viejo lobo banquero"--an old banking wolf --but he is one wolf that Mexico's farmers are glad to see at the door.

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