Elite Financiers and Bankers

In the Roman empire there were several categories of persons who regularly lent money, either as a professional activity or by way of investment.^[271] The most general category of ‘financiers' operating in the last century of the Republic and the first two centuries of the Principate can be divided into several subcategories, depending on factors such as the nature of their activities, their social class and lifestyle, and their financial means.^[272] The most important distinction is that between members of the aristocracy and wealthy plebeians who lent money (elite financiers) on the one hand, and professional bankers on the other.^[273] The share of elite financiers in the credit market is likely to have been substantial and according to some historians even larger than that of banks.^[274] For a period of at least four centuries bankers did, however, play a significant role in the Roman economy.

Already in the sixties and fifties bc ‘there was a liquid and sophisticated market for lending and borrowing money on a very significant scale'.⁹ In these credit markets bankers played a leading part, as is illustrated by the growth of the number of bankers on the place for international commerce Delos.¹⁰ For bankers it was common practice to take security for both consumptive and productive credit. For loans granted between members of the elite, real security would have been less common: these credit relationships would have been subject to social norms (amicitia) and personal security (suretyship) would frequently be taken.^[275] Indirectly, however, the Roman law of real security would also have been relevant for elite financiers, in particular where they would give money to intermediaries (e.g., freedmen or slaves) who would use it to grant secured credit to non-elite borrowers.

Elite financiers

In Rome, lending money at interest with the intention of making a profit (faeneratio) was associated with avaritia and was held in ill-reputed^[276] The modern depiction of the overwhelming importance of agriculture for investment by the wealthy aristocracy risks obscuring the relevance of other sectors of investment, such as the exploitation of natural resources and financed^[277] Members of the elite did invest part of their wealth by lending it at interest, including to professional lenders (faeneratores) who would use these loans to fund their lending activities in the commercial credit markets. The subcategory of elite financiers consisted of members of the senatorial class, equites, and wealthy citizens of plebeian extraction, who—besides granting loans for political and other non-commercial purposes—invested part of their wealth in interest-bearing loansd^[278] They would often lend large sums of money and spent considerable time and effort in doing so, but were not acting in a professional capacity. This is not to say that members of the upper classes would never be professional bankers. In his correspondence with Atticus, Cicero mentions on three occasions a financier who may have been an upper-class merchant banker with a banking establishment of considerable sized^[279] This Castricius not only lent substantial amounts of money at interest against (personal and real) security^[280] but seems to have been actively engaged in (slave?) trade himself.^[281] Members of the elite would, besides lending at interest, also carry out other activities nowadays associated with banks. They would sometimes act as intermediaries in bringing together lenders and borrowers and assist with carrying out payments between different regions of the empire?^[282] Although many loan agreements will have been entered into between members of the same class (e.g., members of the elite), transactions could also cross social boundaries?^[283] This would certainly be the case where a patron would lend money to a client, or when a politician would turn to professional lenders (faeneratores) for obtaining credit.

But also elite financiers would invest their fortune by providing loans to faeneratores, who would lend these on to Romans of the lower classes. Cicero had entered into such a relation with banker Cluvius from Puteoli (who on his death left him a substantial part of his estate).^[284] ^{^[285] The economic position of these elite financiers would sometimes be similar to that of a shareholder in a modern bank, providing capital to slaves, freedmen, or independent persons in order to set up a bank?i Roman banks
Did the Roman empire have banks or bankers? Modern scholars have been blamed for using modern concepts of banking in discussing Roman ‘banks', thereby obscuring the specific functions of ancient banks.22 However, if a banker is defined as someone who manages ‘an undertaking the business of which is to take deposits or other repayable funds from the public and to grant credits for its own account'?³ than Rome certainly did have bankers. And if a bank is an organization within which several persons co-operate on a continuous basis to carry out these activities, Rome certainly had banks too. In particular, the argentarii received deposits from their clients and used the money to grant loans to other clients. They often did so in collaboration with others, whether by way of partnerships (societas), or by using slaves, or a combination of both.2⁴ At one time six persons were active in the Sulpicii bank: Faustus, Cinnamus, and four slaves actively involved in the bank's business.²⁵ It is likely that other slaves would have been used for other, more minor tasks (e.g., as scribes).²⁶ Even when one adds a third element to the definition of banks, that of executing payment orders on behalf of clients, one can still speak of Roman banks. There is good evidence of argentarii and other bankers administering accounts and carrying out payment orders for their clients?⁷ The characterization of an institution as a ‘bank' did not have the same legal consequences as today.
In particular, no banking supervision rules or a central bank existed for Roman banks. This is not to say that there were no legal regulations specifically for certain bankers (in particular: argentarii).²⁸ The share of Roman banks in the credit markets was smaller than today, although differences of opinion exist in modern literature. Andreau, for instance, endorses a rather minimalist view and thinks that elite financiers were—in quantitative terms—much more important than banks?⁹ This would certainly have been the case during some financial crises which occasionally confronted the Roman economy. The credit crisis of 88 bc and other economic and monetary problems may have resulted in a dwindling number of bankers (argentarii) and a reduction of their balance sheets.³⁰ In the second half of the third century ad, bankers even temporarily completely disappear from the scene?¹ But outside these periods of financial crises banks did play a significant role in the credit market?2 Rathbone and Temin emphasize that banks seem to have been involved in all important sectors of the Roman economy. ‘Even if the modal Roman bank was small, Roman banking was big business.'33 They do not deny that members of the elite lent on a large scale, banks, see in particular Cerami and Petrucci 2010: 164-90. On the employment of slaves in banks, see Andreau 1999: 64-70.
25 The above is based on Wolf 2012: 26-7. See also Verboven 2008: 222. A Dacian writing tablet from 28 March 167 ad records a partnership set up for moneylending (FIRA III, nr. 157). However, because the duration of this societas was less than four months one cannot realistically call it a bank.
26 Verboven 2008: 222.
27 See Groschler 1997. See also Rathbone and Temin 2008: 397-8. For a different view see Wolf 2010: 195-6.
28 See in particular Cerami and Petrucci 2010: 109-63, 191-220. Probably in the second century ad an edict on the disclosure of bank accounts (edictum de rationibus argentariis edendis) was enacted (Lenel 1927: 62-4).
On bankers' legal duty to disclose, see, e.g., Ulp. D. 2.13.6.3. 29 Andreau 2020a. ³o Kay 2014: 333.
31 Andreau 1999: 33-4; Harris 2011: 251.
32 Rathbone and Temin 2008: 407; Harris 2011: 236-44; Lerouxel 2016: 209. For the second century bc, see Kay 2014: 329 and passim.
33 Rathbone and Temin 2008: 407. According to Kay (2014: 213) the Mithridatic wars may have been the cause why no large corporate banks emerged in the Roman Republic. Mithradates offered a remittance of 50 per cent. of their debts to borrowers who killed their Roman or Italian creditors. This may even have contributed to the temporary disappearance of argentarii from the sources. but they conclude that much of the lending and borrowing by the elite was routed through banks.³⁴ When in 33 ad emperor Tiberius tried to rescue the Roman credit market by injecting 100 million sesterces as loans, these loans were granted through banks (mensae)3 They also facilitated non-cash payments between parties and between different regions of the empire. They granted overdraft facilities to their clients by carrying out payment instructions on behalf of their customers, even when this was not backed by sufficient funds in the customer's account/⁶ They were an ‘alternative to social financial networks' existing between members of the elite or others (e.g., patronage relationships)/⁷
The bank of the Sulpicii
In the Sulpicii archive we encounter, according to Camodeca, grand maritime commerce on a Mediterranean scale, with its cosmopolitan world of peregrini, oriental goods and its entrepreneurial slaves and freedmen: ‘Trimalchio's world/⁸ The Sulpicii took part in financing maritime commerce in Puteoli, although the scale was rather modest. The Sulpicii were not a major bank. The loans they provided are small compared with the loans granted by elite financiers like Seneca, but certainly not insignificant: HS 12,000 (TPSulp 57), HS 18,000 (TPSulp 31), HS 20,000 (TPSulp 53, 54 and 58), HS 26,000 (TPSulp 85), and HS 50,000 (TPSulp 72)/⁹ In addition, there is a document in which Cinnamus declares to have received on behalf of his patron Faustus an amount of 130,000 sesterces/⁰ Also contained in the Sulpicii archive is a document which may refer to a fiducia cum creditore for an amount of 120,000 sesterces/¹ There are also more than five vadimonia concerning amounts over 50,000 sesterces.
The annual turnover of the Sulpicii must have been hundreds of thousands of sesterces and accordingly their annual profits must have been tens of thousands of sesterces/² The profitability of their bank may ^[286] have enabled the ‘last' generation Sulpicii to purchase the valuable building in Pompeii in which the archive was found almost 1,900 years after it had been stored there before the cataclysmic eruption of Mount Vesuvius. Accepting loans for funding purposes belongs to the core activities of a bank. The Sulpicii partly funded their bank by accepting loans from elite financiers. In the Sulpicii archive there are several documents showing the involvement of the imperial familia and the senatorial aristocracy.⁴³ From the imperial perspective this may have been prompted by a desire to make profitable investments in one of the empire's commercial maritime centres. The motivation behind these loans may have been to support the trade in Alexandrian grain, with a view to the annona publica in RomeTh One of the largest lOUs (HS 94,000) in the archive of the Sulpicii is executed by Gaius Sulpicius Cinnamus in favour of a slave of emperor Claudius (TPSulp 69)?⁵ This could be an indication that the Sulpicii bank (at least partly) was funded by accepting loans from the imperial family, for the purpose of lending it on to its clients.4⁶ Lerouxel even goes so far as concluding that one of the main functions of the Sulpicii bank was to link ‘two universes': the commercial world and the imperial court?⁷ The Sulpicii can also be characterized as true financial intermediaries in the sense that they did carry out activities for third parties, by bringing together lenders and borrowers, and by managing loans provided by third parties. The Sulpicii may also have been coactores argentarii, who besides arranging new loans also collected outstanding debts on behalf of their clients. This may explain the presence of several documents in the archive to which none of the Sulpicii is a party?⁸
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Source: Verhagen Hendrik L.. Security and Credit in Roman Law: The Historical Evolution of Pignus and Hypotheca. Oxford University Press,2022. — 448 p.. 2022

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