Abstract: Carl Frederik Tietgen and Privatbanken in Copenhagen, 1857-1896
The Private Bank of Copenhagen, founded in 1857, was the first major Danish commercial bank. It is interesting both because of its powerful managing director, a "hero" in Danish banking history, C. F. Tietgen, and because of the company's bylaws, apparently chosen to solve the same corporate governance problems we struggle with today. There is a close relationship between Tietgen and the development of modern banking and the formation of modern joint- stock companies in Denmark. In the many historical accounts of Tietgen and Privatbanken, no one has attempted to determine whether Tietgen was a successful manager of Privatbanken from the shareholders' perspective. In this article, we examine the corporate governance structure of Privatbanken and estimate the returns of Privatbanken and its three main competitors based on the bank's dividends and monthly fluctuations in share prices. We conclude that there is no evidence that Tietgen was an outstanding managing director of Privatbanken.