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C. Hoare and Co., a British banking dynasty in business for more than 300 years

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Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#21

Post by chadash »

kyrieeschaton wrote: post #10

The article keeps saying their advantage is their ability to "find solutions other banks can't". I don't know what that means. Exotic loan terms? Collateralizing difficult-to-value assets?

There are a lot of advantages that a small privately owned bank might have over large giants. For example:

* Banking based on reputation - sometimes you know that someone is trustworthy and good for the money, but the numbers on paper don't show it. Maybe their credit score was dinged for some reason that's easy to explain. Maybe you know their family personally. A small bank might be able to lend to people who are excluded by the big banks' algorithms.

* Big banks are under more scrutiny. That doesn't mean they don't do things with dirty money, but they are being watched more closely (I'm not accusing this particular family of shady banking practices... just noting that there is indeed a large amount of dirty money out there that flows through banks, and some banks are more willing to look the other way).

* As you said, collateralizing weird assets. Some banks might allow a thoroughbred horse as collateral. Most probably don't have the expertise to value these things and so they don't want to allow it as collateral.

Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#22

Post by 0xDEFC0DE »

kyrieeschaton wrote: post #10

The article keeps saying their advantage is their ability to "find solutions other banks can't". I don't know what that means. Exotic loan terms? Collateralizing difficult-to-value assets?

>Collateralizing difficult-to-value assets?

A family like this definitely has connections. Maybe they collateralize favors that can be given to them and word of those don't get out because it's a tight-knit group.

Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#23

Post by jsty »

kyrieeschaton wrote: post #10

The article keeps saying their advantage is their ability to "find solutions other banks can't". I don't know what that means. Exotic loan terms? Collateralizing difficult-to-value assets?

There's a few good examples in this article [0] by Barron's, but amongst the access to not-widely-available investments mentioned by other posters, there's a general desire to understand the client as a person rather than a data point.

It's less likely you go in seeking a loan etc and get told "risk model says no" because you have your assets tied up in a business or other non-standard investments their processes aren't built to understand.

This is available to a similar degree at other private banks.

[0] https://www.barrons.com/articles/SB5000142405311190457170457...

Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#24

Post by Theodores »

I remember in my shop assistant days getting cheques from customers who banked with them.

It felt like the punchline of an elaborate joke.

At the time I was selling bikes. The kids from the council estate would have their parents or grandparents save up all year in a special book, paying by instalments. Then, at Christmas time, they would get a Raleigh bike, not quite the cheapest but certainly not the most expensive. It would be a nice new bike though.

Meanwhile, we also had a trade in second hand bikes that customers would trade in. Out the back would be all kinds of rusting bicycles that had seen better days.

Some customers would want these rather than the new shiny bikes. So you would go out the back and find something that would be suitable.

Often a little bit of work would be needed to make these left-over has-been bicycles saleable. Then you would get further ground down on the price, adding on components from the workshop that happened to be there, e.g. a new seat or an OEM chain to replace the orange rusted one on the bike.

The poor child that would have to ride the thing would be actually too small for it, the parents insisting on the bike the child could 'grow into'. The council estate kids would actually get the correct size for them, the parents would save up for a replacement over the coming year. But these kids buying second hand just had some ungainly monster sized bike that they had to 'grow into'.

People of wealth don't actually show off their wealth if they are aristocratic. They still wear the same coat for decades so you can't guess that they are mansion-dwelling loaded or poor. The accent might give a clue but if you are customer service driven you just get on with it rather than make these discrimination thoughts.

So, finally, having been haggled down to make the sale totally not worth it, there are one of two denouements. The more common one is to kindly offer to put the bike in the car for them to discover that it is a Range Rover (or posh Volvo).

The other 'I have been had' denouement was for them to pay by cheque and for it to be a cheque from this very bank. (payment by cheque dates this story).

Along with the 'drat, I have been had' sinking feeling there is also an unwritten understanding that you don't ask for the cheque guarantee card. Just ownership of the chequebook from the bank makes it good enough. By then you have clocked their scruffy attire is actually aristocratic posh or maybe even seen the Range Rover.

The rich don't get rich by giving their money away. This lesson was drummed into me by these moments.

I think that this bank must know this. Their customer is not going to be flipping houses and cars, forever speculating and living beyond their means. They pay for the upkeep to the estate, Tarquin's school fees and haggle for everything else.

The next group of 'least profitable customer' for me happened to be Scottish. Inevitably if I had a customer with a Scottish accent I kind of knew my boss would be grilling me later for being tricked into a discount too far or a freebee too many. There would be a different denouement scenario with your typical Scottish customer. You would have everything agreed and then if some shop 50 miles away had allegedly offered them a price 1p cheaper than your best deal they would be fully willing to walk out on the sale, presumably off to get that 1p saving elsewhere.

Luckily Scottish customers were few and far between, as were shoplifters, however, it was the C. Hoare cheque owners (and the other one, Coutts) that you had to watch out for.

Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#25

Post by ataturk »

kyrieeschaton wrote: post #10

The article keeps saying their advantage is their ability to "find solutions other banks can't". I don't know what that means. Exotic loan terms? Collateralizing difficult-to-value assets?

Kneecapping the competition, piracy, whatever it takes.

Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#26

Post by zarathustraa »

chadash wrote: post #18
zarathustraa wrote: post #8

It seems to me like there is a space to become the Gucci/Rolls Royce/Hermes/... of banking. The place where famous Instagrammers bank. Expensive, authentic, exclusive, heritage,

There are many existing banks that cater to rich people.

Name one bank that the average person on the street recognizes as an exclusive bank that only rich people can afford to use, like they do with Ferarri or Rolls Royce.

Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#27

Post by djpr »

zarathustraa wrote: post #26
chadash wrote: post #18

Earlier quoted context omitted.

There are many existing banks that cater to rich people.

Name one bank that the average person on the street recognizes as an exclusive bank that only rich people can afford to use, like they do with Ferarri or Rolls Royce.

I worked with a start-up that focused on providing software for private family offices. These are for UHNW people who have more than 100 million USD. They do not want to brag that they go to the Bentley of banks. They want to keep it as private as possible.

Typically UHNW has a private family office, something between a concierge and philanthropy and a private investment organization, which maintain relationships with private banking services provided by Credit Suisse, UBS, etc. It can cost 1-2 million USD a year to run a private family office.

You never hear about family offices and in some areas you may only see a discreet sign at a posh building saying "private banking" and all of these folks want to keep it that way. The branding play here is being tight-lipped and discrete.

Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#28

Post by chrisseaton »

zarathustraa wrote: post #26
chadash wrote: post #18

Earlier quoted context omitted.

There are many existing banks that cater to rich people.

Name one bank that the average person on the street recognizes as an exclusive bank that only rich people can afford to use, like they do with Ferarri or Rolls Royce.

Coutts is one name an average person on the street in the UK would recognise as exclusive bank.

Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#29

Post by mjn »

gumby wrote: post #15

I wonder if legendary computer scientist Tony Hoare (C. A. R. Hoare) was part of the family, especially given his three given names.

He appears to be a distant relative, yes, but by my count, five generations removed from any direct connection to the banking business.

Starting with his entry [1] on thepeerage.com, a UK genealogical site for the upper classes, you can backtrack to find that his great-great grandfather was a Charles James Hoare [2], who appears, if this Wikipedia entry is the same person [3], to have been a a Church of England clergyman and himself the son of a partner in the Hoare private bank. So, C.A.R. Hoare's great-great-great grandfather was part of the bank. The four generations in between seem to have been various kinds of upper-middle class government or quasi-government employees though: clergyman, clergyman, military officer, and colonial civil servant.

Incidentally, I got the pointer to thepeerage.com from his biography in the book Reflections on the Work of C.A.R. Hoare, which calls his family background "somewhat upper-class" and references the site in a footnote.

[1] http://thepeerage.com/p14062.htm#i140620

[2] http://thepeerage.com/p39939.htm#i399386

[3] https://en.wikipedia.org/wiki/Charles_Hoare_(priest)

Re: C. Hoare and Co., a British banking dynasty in business for more than 300 years

#30

Post by loblollyboy »

Theodores wrote: post #24

I remember in my shop assistant days getting cheques from customers who banked with them. It felt like the punchline of an elaborate joke. At the time I was selling bikes. The kids from the council estate would have their parents or grandparents save up all year in a special book, paying by instalments. Then, at Christmas time, they would get a Raleigh bike, not quite the cheapest but certainly not the most expensive…

I'm born and raised in the US by a single American mother - but my dad was a real Scotsman, sometimes I see my aunt on his side and she always says "you might not have an accent, but I know yer Scottish because yer tight (cheap) and all Scots are tight"
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