CHAPTER THREE
JULY
1
AS A LITTLE BOY, Hugh had thought Pilasters bank was owned by the walkers. These personages were in fact lowly messengers, but they were all rather portly, and wore immaculate morning dress with silver watch-chains across their ample waistcoats, and they moved about the bank with such ponderous dignity that to a child they appeared the most important people there.
Hugh had been brought here at the age of ten by his grandfather, old Seth’s brother. The marble-walled banking hall on the first floor had seemed like a church: huge, gracious, silent, a place where incomprehensible rites were performed by an elite priesthood in the service of a divinity called Money. Grandfather had shown him all around: the carpeted hush of the third floor, occupied by the partners and their correspondence clerks, where little Hugh had been given a glass of sherry and a plate of biscuits in the Partners’ Room; the senior clerks at their tables on the fourth floor, bespectacled and anxious, surrounded by bundles of papers tied with ribbon like gifts; and the juniors on the top floor, sitting at their high desks in lines like Hugh’s toy soldiers, scratching entries in ledgers with inky fingers. But best of all, for Hugh, had been the basement, where contracts even older than grandfather were kept in vaults, thousands of postage stamps waited to be licked, and there was a whole room full of ink stored in enormous glass jars. It had amazed him to reflect on the process. The ink came into the bank, it was spread over the papers by the clerks, and then the papers were returned to the basement to be stored forever; and somehow this made money.
The mystery had gone out of it now. He knew that the massive leather-bound ledgers were not arcane texts but simple lists of financial transactions, laboriously compiled and scrupulously updated; and his own fingers had become cramped and ink-stained by days of writing in them. A bill of exchange was no longer a magic spell but merely a promise to pay money at a future date, written on a piece of paper and guaranteed by a bank. Discounting, which as a child he had thought must mean counting backwards from a hundred down to one, turned out to be the practice of buying bills of exchange at a little less than their face value, keeping them until their due date, then cashing them at a small profit.
Hugh was a general assistant to Jonas Mulberry, the Principal Clerk. A bald man of about forty, Mulberry was good-hearted but a little sour. He would always take time to explain things to Hugh, but he was very quick to find fault if Hugh was in the least hasty or careless. Hugh had been working under him for the past year, and yesterday he had made a serious mistake. He had lost a bill of lading for a consignment of Bradford cloth destined for New York. The Bradford manufacturer had been downstairs in the banking hall asking for his money, but Mulberry had needed to check the bill before authorizing payment, and Hugh could not find the document. They had been obliged to ask the man to come back in the morning.
In the end Hugh had found the bill, but he had spent most of the night worrying about it, and this morning he had devised a new system of dealing with papers for Mulberry.
On the table in front of him he had two cheap wooden trays, two oblong cards, a quill pen and an inkwell. He wrote slowly and neatly on one card:
For the attention of the Principal Clerk
On the second card he wrote:
Having been dealt with by the Principal Clerk
He carefully blotted his writing then fixed one card to each tray with tacks. He put the trays on Jonas Mulberry’s table and stood back to survey his work. At that moment Mr. Mulberry came in. “Good morning, Mr. Hugh,” he said. All family members were addressed this way at the bank because otherwise there would be confusion among all the different Mr. Pilasters.
“Good morning, Mr. Mulberry.”
“And what the dickens is this?” Mulberry said tetchily, looking at the trays.
“Well,” Hugh began. “I found that bill of lading.”
“Where was it?”
“Mixed up with some letters you had signed.”
Mulberry narrowed his eyes. “Are you trying to say it was my fault?”
“No,” Hugh said quickly. “It’s my responsibility to keep your papers in order. That’s why I’ve instituted the tray system—to separate papers you’ve already dealt with from papers you haven’t yet looked at.”
Mulberry grunted noncommittally. He hung his bowler hat on the hook behind the door and sat down at the table. Finally he said: “We’ll try it—it might be quite effective. But next time, have the courtesy to consult me before implementing your ingenious ideas. This is my room, after all, and I am the Principal Clerk.”
“Certainly,” Hugh said. “I’m sorry.” He knew he should have asked Mulberry’s permission, but he had been so keen on his new idea that he had not had the patience to wait.
“The Russian loan issue closed yesterday,” Mulberry went on. “I want you to go down to the post room and organize the counting of the applications.”
“Right.” The bank was raising a loan of two million pounds for the government of Russia. It had issued 100-pound bonds which paid five pounds interest per year; but they were selling the bonds for 93 pounds, so the true interest rate was over five and three-eighths. Most of the bonds had been bought by other banks in London and Paris, but some had been offered to the general public, and now the applications would have to be counted.
“Let’s hope we have more applications than we can fulfill,” Mulberry said.
“Why?”
“That way the unlucky applicants will try to buy the bonds tomorrow on the open market, and that will drive the price up perhaps to 95 pounds—and all our customers will feel they’ve bought a bargain.”
Hugh nodded. “And what if we have too few applications?”
“Then the bank, as underwriter, has to buy the surplus—at 93 pounds. And tomorrow the price may go down to 92 or 91 pounds, and we will have made a loss.”
“I see.”
“Off you go.”
Hugh left Mulberry’s office, which was on the fourth floor, and ran down the stairs. He was happy that Mulberry had accepted his tray idea and relieved that he was not in worse trouble over the lost bill of lading. As he reached the third floor, where the Partners’ Room was, he saw Samuel Pilaster, looking dapper in a silver-gray frock coat and a navy-blue satin tie. “Good morning, Uncle Samuel,” Hugh said.
“Morning, Hugh. What are you up to?” He showed more interest in Hugh than the other partners did.
“Going to count the applications for the Russian loan.”
Samuel smiled, showing his crooked teeth. “I don’t know how you can be so cheerful with a day of that in front of you!”
Hugh continued down the stairs. Within the family, people were beginning to talk in hushed tones about Uncle Samuel and his secretary. Hugh did not find it shocking that Samuel was what people called effeminate. Women and vicars might pretend that sex between men was perverted, but it went on all the time at schools such as Windfield and it never did anyone any harm.
He reached the first floor and entered the imposing banking hall. It was only half-past nine, and the dozens of clerks who worked at Pilasters were still streaming through the grand front door, smelling of bacon breakfasts and underground railway trains. Hugh nodded to Miss Greengrass, the only female clerk. A year ago, when she had been hired, debate had raged through the bank as to whether a woman could possibly do the work. In the event she had settled the matter by proving herself supremely competent. There would be more female clerks in the future, Hugh guessed.
He took the back stairs to the basement and made his way to the post room. Two messengers were sorting the mail, and applications for the Russian loan already filled one big sack. Hugh decided he would get two junior clerks to add up the applications, and he would check their arithmetic.
The work took most of the day. It was a few minutes before four o’clock when he double-checked the last bundle and added the last column of figures. The issue was undersubscribed: a little more than one hundred thousand pounds’ worth of bonds remained unsold. It was not a big shortfall, as a proportion of a two-million-pound issue, but there was a big psychological difference between oversubscribed and undersubscribed, and the partners would be disappointed.
He wrote the tally on a clean sheet of paper and went in search of Mulberry. The banking hall was quiet now. A few customers stood at the long polished counter. Behind the counter, clerks lifted the big ledgers on and off the shelves. Pilasters did not have many private accounts. It was a merchant bank, lending money to traders to finance their ventures. As old Seth would say, the Pilasters weren’t interested in counting the greasy pennies of a grocer’s takings or the grubby banknotes of a tailor—there was not enough profit in it. But all the family kept accounts at the bank, and the facility was extended to a small number of very rich clients. Hugh spotted one of them now: Sir John Cammel. Hugh had known his son at Windfield. A thin man with a bald head, Sir John earned vast incomes from coal mines and docks on his lands in Yorkshire. Now he was pacing the marble floor looking impatient and bad-tempered. Hugh said: “Good afternoon, Sir John, I hope you’re being attended to?”
“No, I’m not, lad. Doesn’t anyone do any work in this place?”
Hugh glanced around rapidly. None of the partners or senior clerks was in sight. He decided to use his initiative. “Will you come upstairs to the Partners’ Room, sir? I know they will be keen to see you.”
“All right.”
Hugh led him upstairs. The partners all worked together in the same room—so that they could keep an eye on one another, according to tradition. The room was furnished like the reading room in a gentlemen’s club, with leather sofas, bookcases and a central table with newspapers. In framed portraits on the walls, ancestral Pilasters looked down their beaklike noses at their descendants.
The room was empty. “One of them will be back in a moment, I’m sure,” Hugh said. “May I offer you a glass of Madeira?” He went to the sideboard and poured a generous measure while Sir John settled himself in a leather armchair. “I’m Hugh Pilaster, by the way.”
“Oh, yes?” Sir John was somewhat mollified to find he was talking to a Pilaster, rather than an ordinary office.
“Yes, sir. I was there with your son Albert. We called him Hump.”
“All Cammels are called Hump.”
“I haven’t seen him since … since then.”
“He went to the Cape Colony, and liked it there so much that he never came back. He raises horses now.”
Albert Cammel had been at the swimming hole on that fateful day in 1866. Hugh had never heard his version of how Peter Middleton drowned. “I’d like to write to him,” Hugh said.
“I daresay he’ll be glad of a letter from an old school friend. I’ll give you his address.” Sir John moved to the table, dipped a quill in the inkwell and scribbled on a sheet of paper. “There you are.”
“Thank you.” Sir John was mollified now, Hugh noted with satisfaction. “Is there anything else I can do for you while you’re waiting?”
“Well, perhaps you can deal with this.” He took a cheque out of his pocket. Hugh examined it. It was for a hundred and ten thousand pounds, the largest personal cheque Hugh had ever handled. “I’ve just sold a coal mine to my neighbor,” Sir John explained.
“I can certainly deposit it for you.”
“What interest will I get?”
“Four percent, at present.”
“That’ll do, I suppose.”
Hugh hesitated. It occurred to him that if Sir John could be persuaded to buy Russian bonds, the loan issue could be transformed from being slightly undersubscribed to slightly oversubscribed. Should he mention it? He had already overstepped his authority by bringing a guest into the Partners’ Room. He decided to take a chance. “You could get five and three-eighths by buying Russian bonds.”
Sir John narrowed his eyes. “Could I, now?”
“Yes. The subscription closed yesterday, but for you—”
“Are they safe?”
“As safe as the Russian government.”
“I’ll think about it.”
Hugh’s enthusiasm had been aroused now and he wanted to close the sale. “The rate may not be the same tomorrow, as you know. When the bonds come on the open market the price may go up or down.” Then he decided he was sounding too eager, so he backed off. “I’ll place this cheque to your account immediately, and if you wish you could talk to one of my uncles about the bonds.”
“All right, young Pilaster—off you go.”
Hugh went out and met Uncle Samuel in the hall. “Sir John Cammel is in there, Uncle,” he said. “I found him in the banking hall looking bad-tempered, so I’ve given him a glass of Madeira—I hope I did the right thing.”
“I’m sure you did,” said Samuel. “I’ll take care of him.”
“He brought in this cheque for a hundred and ten thousand. I mentioned the Russian loan—it’s undersubscribed by a hundred thousand.”
Samuel raised his eyebrows. “That was precocious of you.”
“I only said he might talk to one of the partners about it if he wanted a higher rate of interest.”
“All right. It’s not a bad idea.”
Hugh returned to the banking hall, pulled out Sir John’s ledger and entered the deposit, then took the cheque to the clearing clerk. Then he went up to the fourth floor to Mulberry’s office. He handed over the tally of Russian bonds, mentioned the possibility that Sir John Cammel might buy the balance, and sat down at his own table.
A walker came in with tea and bread and butter on a tray. This light refreshment was served to all clerks who stayed at the office after four-thirty. When work was light most people left at four. Bank staff were the elite among clerks, much envied by merchants’ and shippers’ clerks who often worked until late and sometimes right through the night.
A little later Samuel came in and handed some papers to Mulberry. “Sir John bought the bonds,” he said to Hugh. “Good work—that was an opportunity well taken.”
“Thank you.”
Samuel spotted the labeled trays on Mulberry’s desk. “What’s this?” he said in a tone of amusement. “‘For the attention of the Principal Clerk … Having been dealt with by the Principal Clerk.’”
Mulberry answered him. “The purpose is to keep incoming and outgoing papers separate. It avoids confusion.”
“What a good scheme. I think I might do the same.”
“As a matter of fact, Mr. Samuel, it was young Mr. Hugh’s idea.”
Samuel turned an amused look on Hugh. “I say, you are keen, dear boy.”
Hugh was sometimes told he was too cocky, so now he pretended to be humble. “I know I’ve got an awful lot to learn still.”
“Now, now, no false modesty. Tell me something. If you were to be released from Mr. Mulberry’s service, what job would you like to do next?”
Hugh did not have to think about his answer. The most coveted job was that of correspondence clerk. Most clerks saw only a part of a transaction—the part they recorded—but the correspondence clerk, drafting letters to clients, saw the whole deal. It was the best position in which to learn, and the best from which to win promotion. And Uncle Samuel’s correspondence clerk, Bill Rose, was due to retire.
Without hesitation Hugh said: “I’d like to be your correspondence clerk.”
“Would you, now? After only a year in the bank?”
“By the time Mr. Rose goes it will be eighteen months.”
“So it will.” Samuel still seemed amused, but he had not said no. “We’ll see, we’ll see,” he said, and he went out.
Mulberry said to Hugh: “Did you advise Sir John Cammel to buy the surplus Russian bonds?”
“I just mentioned it,” said Hugh.
“Well, well,” said Mulberry. “Well, well.” And he sat staring at Hugh speculatively for several minutes thereafter.