Disconto-Gesellschaft

The Disconto-Gesellschaft (full name: Direction der Disconto-Gesellschaft), with headquarters in Berlin, was founded in 1851. It was, until its 1929 merger into Deutsche Bank, one of the largest German banking organizations.

It was founded in 1851 as a “credit partnership,” and in 1856 was changed into a limited liability, under the name of “Direktion der Disconto-Gesellschaft,” with a capital of 30,000,000 marks. Its founder was David Hansemann, later Prussian Minister of Finance. Its purpose and earliest activities were in the fostering of current account business and the underwriting of German state and local loans and railway shares. In 1890, a branch was opened in London, from which time dated the institution's activities in overseas matters. In 1901, on the liquidation of the house of M. A. Rothschild & Sons of Frankfurt am Main, a branch was established in that city, connection being made with the Rothschild Syndicate, with which it has since been largely identified.

The interests formed with this group made the Disconto-Gesellschaft a prominent factor in the underwriting of many important national and railway loans, notably the state loans of Russia, Romania, China and Japan. In addition, in connection with other interests, it was instrumental in the financing of the Kamerun Railroad Company and the Great Venezuela Railway, both speculative enterprises, and the latter eventually of great financial annoyance.

As a national factor, the Disconto-Gesellschaft lent its greatest support to industry through the promotion and financing of enterprises for the development of Germany's natural resources: the mining of coal and metals, smelting, iron and steel, potash, shipbuilding, electrical development, railways, fire and life insurance, etc. It assisted in the underwriting of the 10,000,000 thaler (30,000,000 marks) 5 per cent loan for the Krupp Works, in 1874 — the first instance in Germany of the issue of fractional form bonds secured by blanket mortgage and providing for common representation of the holders of these bonds.

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