Brown Brothers Harriman & Co. (BBH) is the oldest and one of the largest private
investment bank
Investment is the dedication of money to purchase of an asset to attain an increase in value over a period of time. Investment requires a sacrifice of some present asset, such as time, money, or effort.
In finance, the purpose of investing is ...
s in the United States.
[
* a "Brown Brothers, who are the oldest as well as one of the largest private banking concerns in the country" — ¶ 2
* b "The firm was started in America in 1800 in Baltimore by the original Brown ... after starting in general dry goods business" — ¶ 3
* c "in 1825 the banking office of the firm was opened in New York City on Pine Street. The firm has been on its present Wall Street site since 1833." — ¶ 3][
* a "Alex. (Alexander) Brown & Sons (founded 1800), the first and oldest continually operating investment banking firm in the United States." — Notes §, ¶ 1] In 1931, the merger of
Brown Brothers & Co. (founded in 1818) and Harriman Brothers & Co. formed the current BBH.
Brown Brothers Harriman is also notable for the number of influential American politicians, government appointees, and
Cabinet
Cabinet or The Cabinet may refer to:
Furniture
* Cabinetry, a box-shaped piece of furniture with doors and/or drawers
* Display cabinet, a piece of furniture with one or more transparent glass sheets or transparent polycarbonate sheets
* Filing ...
members who have worked at the company, such as
W. Averell Harriman,
Prescott Bush
Prescott Sheldon Bush (May 15, 1895 – October 8, 1972) was an American banker as a Wall Street executive investment banker, he represented Connecticut in the from 1952 of the Bush family, he was the father of former Vice President and Pre ...
,
Robert A. Lovett
Robert Abercrombie Lovett (September 14, 1895May 7, 1986) was the fourth United States Secretary of Defense, having been promoted to this position from Deputy Secretary of Defense. He served in the cabinet of President of the United States, Presi ...
,
Richard W. Fisher,
Robert Roosa
Robert Vincent Roosa (June 21, 1918 – December 23, 1993) was an American economist and banker. He served as Treasury Undersecretary for Monetary Affairs during the Kennedy administration. He believed the U.S. dollar should be the world's le ...
, and
Alan Greenspan
Alan Greenspan (born March 6, 1926) is an American economist who served as the 13th chairman of the Federal Reserve from 1987 to 2006. He works as a private adviser and provides consulting for firms through his company, Greenspan Associates LLC. ...
.
Overview
Brown Brothers Harriman provides advisory,
wealth management
Wealth management (WM) or wealth management advisory (WMA) is an investment advisory service that provides financial management and wealth advisory services to a wide array of clients ranging from affluent to high-net-worth (HNW) and ultra-high- ...
,
commercial banking
A commercial bank is a financial institution which accepts deposits from the public and gives loans for the purposes of consumption and investment to make profit.
It can also refer to a bank, or a division of a large bank, which deals with cor ...
, and investor services for corporate institutions and
high-net-worth individual
High-net-worth individual (HNWI) is a term used by some segments of the financial services industry to designate persons whose investible wealth (assets such as stocks and bonds) exceeds a given amount. Typically, these individuals are defined ...
clients. Alongside the aforementioned services, the firm provides global custody,
foreign exchange
The foreign exchange market (Forex, FX, or currency market) is a global decentralized or over-the-counter (OTC) market for the trading of currencies. This market determines foreign exchange rates for every currency. It includes all as ...
,
private equity
In the field of finance, the term private equity (PE) refers to investment funds, usually limited partnerships (LP), which buy and restructure financially weak companies that produce goods and provide services. A private-equity fund is both a ty ...
,
merger and acquisition
Mergers and acquisitions (M&A) are business transactions in which the ownership of companies, other business organizations, or their operating units are transferred to or consolidated with another company or business organization. As an aspect ...
s,
investment management
Investment management is the professional asset management of various securities, including shareholdings, bonds, and other assets, such as real estate, to meet specified investment goals for the benefit of investors. Investors may be institut ...
for individuals and institutions, personal trust and estate administration, and securities
brokerage
A broker is a person or firm who arranges transactions between a buyer and a seller for a commission when the deal is executed. A broker who also acts as a seller or as a buyer becomes a principal party to the deal. Neither role should be confu ...
services. Organized as a partnership, BBH has approximately 6,000 staff in 18 offices throughout North America, Europe, and Asia. Currently, the firm has 38 partners,
and acts as custodian and administrator for $3.3 trillion and $1.2 trillion in assets, respectively.
History
![William Averell Harriman](https://upload.wikimedia.org/wikipedia/commons/9/96/William_Averell_Harriman.jpg)
After immigrating to Baltimore in 1800 and building a successful
linen
Linen () is a textile made from the fibers of the flax plant.
Linen is very strong, absorbent, and dries faster than cotton. Because of these properties, linen is comfortable to wear in hot weather and is valued for use in garments. It also ...
mercantile trading business,
[ Alexander Brown and his four sons co-founded Alex. Brown & Sons.][
* a "To him were born in Ballymena, four sons, William, George, John Alexander and James." — Pg. 116, ¶ 2
* b "The family came to America in 1800, settling in Baltimore, where, after a prosperous career as a linen merchant, Mr. Brown founded the bank of Alex. Brown & Sons, in partnership with his four sons. He died April 6, 1834." — Pg. 116, ¶ 2
* c "established the houses of Brown, Shipley & Co., in England][
* a "the oldest continuously operating investment bank in America, according to experts. Founded in 1800 as Alex. Brown & Sons" — ¶ 17] In 1818, one son, John Alexander Brown, traveled to Philadelphia
Philadelphia, often called Philly, is the largest city in the Commonwealth of Pennsylvania, the sixth-largest city in the U.S., the second-largest city in both the Northeast megalopolis and Mid-Atlantic regions after New York City. Sinc ...
to establish John A. Brown and Co.[
* a "John A. Brown travels to Philadelphia and establishes John A. Brown & Co. ... John A. Brown's historic Philadelphia house also serves as the founding date for the future Brown Brothers Harriman & Co." — Pg. 1, ¶ 8] In 1825, another son, James Brown, established Brown Brothers & Co.[
* a "Baltimore in 1800 and opened a dry goods business with which his four sons became associated."
* b "One son, John (1788-1872), opened a branch in Philadelphia in 1818"
* c "Another son, James (1791-1877) established Brown Brothers & Co. in New York City in 1825 and eventually absorbed the other branches."
* d "In addition, Brown Brothers & Co. was associated with the English firm of Brown, Shipley & Co., which was run by another brother, William Brown (1784-1864)."] on Pine Street in Lower Manhattan and relocated to Wall Street
Wall Street is an eight-block-long street in the Financial District of Lower Manhattan in New York City. It runs between Broadway in the west to South Street and the East River in the east. The term "Wall Street" has become a metonym for t ...
in 1833.[ This firm eventually acquired all other Brown branches in the U.S.][ Another son, William Brown, had established William Brown & Co. in England in 1810, which was renamed Brown, Shipley & Co. in 1839 and became a separate entity in 1918.][
* a "linen merchant Alexander Brown emigrated to the United States in 1800" — ¶ 1
* b "In 1810, Alexander's eldest son William returned to England and established the trading firm William Brown & Co. in Liverpool. This became Brown Shipley & Co. in 1839 and relocated to London. It separated from Brown Brothers as a distinct business entity in 1918." — ¶ 1][
Following the ]panic of 1837
The Panic of 1837 was a financial crisis in the United States that touched off a major depression, which lasted until the mid-1840s. Profits, prices, and wages went down, westward expansion was stalled, unemployment went up, and pessimism abound ...
, Brown Brothers withdrew from most of its lending business. Two of the brothers, John and George, sold their shares in the company to the other two brothers, William and James. During the recovery from this economic turmoil, they chose to focus solely on currency exchange and international trade.
Merger
On January 2, 1931, Brown Brothers & Co. merged with two other business entities, Harriman Brothers & Company, a private bank started with railway money, and W. A. Harriman & Co. to form Brown Brothers Harriman & Co. Founding partners included:
''Time
Time is the continued sequence of existence and events that occurs in an apparently irreversible succession from the past, through the present, into the future. It is a component quantity of various measurements used to sequence events, to ...
'' December 22, 1930, issue announced that the three-way merger featured 11 Yale
Yale University is a private research university in New Haven, Connecticut. Established in 1701 as the Collegiate School, it is the third-oldest institution of higher education in the United States and among the most prestigious in the wor ...
graduates among 16 founding partners.[
* a "Of the 16 partners in the new firm of Brown Bros., Harriman & Co., eleven are Yale graduates."] Eight of the partners listed above, except for Moreau Delano and Thatcher Brown, were Skull and Bones
Skull and Bones, also known as The Order, Order 322 or The Brotherhood of Death, is an undergraduate senior secret student society at Yale University in New Haven, Connecticut. The oldest senior class society at the university, Skull and Bone ...
members.
In 1930s the company acted as a U.S. base for the German industrialist Fritz Thyssen
Friedrich "Fritz" Thyssen (9 November 1873 – 8 February 1951) was a German businessman, born into one of Germany's leading industrial families. He was an early supporter of the Nazi Party, but later broke with them.
Biography
Youth
Thyssen w ...
, who helped finance Adolf Hitler
Adolf Hitler (; 20 April 188930 April 1945) was an Austrian-born German politician who was dictator of Nazi Germany, Germany from 1933 until Death of Adolf Hitler, his death in 1945. Adolf Hitler's rise to power, He rose to power as the le ...
.
After the passage of the Glass-Steagall Act, the partners decided to focus on commercial banking, becoming a private bank
Private banks are banks owned by either the individual or a general Partner (business rank), partner(s) with limited partner(s). Private banks are not incorporation (business), incorporated. In any such case, creditors can look to both the "enti ...
, and to spin its securities marketing and underwriting off into Harriman, Ripley and Company Harriman, Ripley and Company was an investment bank created by the partners of Brown Brothers Harriman after the passage of the Glass Steagall Act mandated firewalls between commercial banks and investment banks. Brown Brothers Harriman positioned ...
which eventually evolved into Drexel Burnham Lambert
Drexel Burnham Lambert was an American multinational investment bank that was forced into bankruptcy in 1990 due to its involvement in illegal activities in the junk bond market, driven by senior executive Michael Milken. At its height, it was a ...
via mergers.
Harriman, a partner in the firm, was the ambassador and statesman responsible for the relationship between Winston Churchill
Sir Winston Leonard Spencer Churchill (30 November 187424 January 1965) was a British statesman, soldier, and writer who served as Prime Minister of the United Kingdom twice, from 1940 to 1945 Winston Churchill in the Second World War, dur ...
and Franklin Roosevelt
Franklin Delano Roosevelt (; ; January 30, 1882April 12, 1945), often referred to by his initials FDR, was an American politician and attorney who served as the 32nd president of the United States from 1933 until his death in 1945. As the ...
during World War II. Some historical records of Brown Brothers Harriman and its precursor companies are housed in the manuscript collections at the New-York Historical Society
The New-York Historical Society is an American history museum and library in New York City, along Central Park West between 76th and 77th Streets, on the Upper West Side of Manhattan. The society was founded in 1804 as New York's first museum. ...
.
See also
* Alex. Brown & Sons Building
* Bankers Trust
Bankers Trust was a historic American banking organization. The bank merged with Alex. Brown & Sons in 1997 before being acquired by Deutsche Bank in 1999. Deutsche Bank sold the Trust and Custody division of Bankers Trust to State Street Corpor ...
* Brown Memorial Presbyterian Church
Brown Memorial Park Avenue Presbyterian Church of Baltimore, Maryland, U.S., is a large, Gothic Revival-style church built in 1870 and located at Park Avenue and Lafayette Avenue in the city's Bolton Hill neighborhood. Named in memory of a Bal ...
References
Further reading
* Karabell, Zachary (2021) ''Inside Money: Brown Brothers Harriman and the American Way of Power'
excerpt
* Karabell, Zachary (May 14, 2021)
"The Capitalist Culture That Built America: Since the early 19th century, the firm of Brown Brothers defined the distinctive American mix of financial power and public service. Its example can still instruct us."
''The Wall Street Journal''.
* Kouwenhoven, John Atlee (1968)
''Partners in Banking: An Historical Portrait of a Great Private Bank, Brown Brothers Harriman & Co., 1818-1968''
External links
*
{{DEFAULTSORT:Brown Brothers Harriman and Co.
Investment banks in the United States
Private banks
Banks based in New York City
American companies established in 1931
Banks established in 1931
Financial services companies established in 1931
1931 establishments in New York (state)
Privately held companies based in New York City