Montagu Norman, 1st Baron Norman

Montagu Collet Norman, 1st Baron Norman
Born	England
Died	4 February 1950(1950-02-04) (aged 78) Kensington, London, England
Occupation	Banker
Years active	1892–1944
Known for	Governor of the Bank of England (1920–1944)

Montagu Collet Norman, 1st Baron Norman DSO PC (6 September 1871 – 4 February 1950) was a distinguished English banker, primarily recognized for his tenure as Governor of the Bank of England from 1920 until 1944.

Norman steered the Bank through one of the most turbulent economic eras in British history and was noted for his unique personality and approach. As a powerful figure in finance, he earned the nickname "the currency dictator of Europe" from The Wall Street Journal, a label he accepted during a 1930 address to the Bank's Court. The renowned economist and Court member John Maynard Keynes famously commented: "Montagu Norman, always absolutely charming, always absolutely wrong."

His reputation suffered due to his involvement in enabling the transfer of Czech gold reserves to the Nazi regime in March 1939, an activity that continued briefly after the outbreak of World War II. The British government ultimately intervened to halt these operations.

Early life and military service

As the eldest son of Frederick Norman and Lina Susan Penelope Collet—daughter of Sir Mark Wilks Collet, 1st Baronet, a former Bank of England Governor—Norman was born into a family with deep banking roots. His brother Ronald Collet Norman and nephew Mark Norman were also prominent in banking circles, while his great-nephew David Norman became a notable figure in London's financial sector and an arts patron. Educated at Eton and briefly attending King's College, Cambridge, he enlisted in the 4th Bedfordshire and Hertfordshire militia in 1894. Norman served during the Second Boer War, where he was awarded the Distinguished Service Order in 1901.

Merchant banking

Following a period spent in Europe, Norman entered Martins Bank in 1892, where his father held partnership. He transferred to Brown, Shipley & Co. in 1894, a firm connected to his maternal grandfather’s lineage, and then moved to New York in 1895 to join Brown Bros. & Co.. By 1900, he had become a partner at Brown Shipley but retired from merchant banking by 1915.

Bank of England

Norman joined the board of directors at the Bank of England in 1907 and acted as a financial consultant throughout World War I. Elevated to the role of Deputy Governor in 1917, he assumed the position of Governor three years later. Under his leadership, the Bank expanded its international influence by acquiring the Anglo-Austrian Bank in Vienna and founding the Anglo-Czechoslovak Bank in Prague. A staunch advocate for reinstating the gold standard, he implemented this policy in 1925 despite opposition from economist John Maynard Keynes.

Amidst the Great Depression, Norman cautioned that without prompt measures "the capitalist system throughout the civilized world will be wrecked within a year." He arranged $250 million to support the British pound but ultimately oversaw Britain’s compelled exit from the gold standard in 1931 following a financial crisis exacerbated by concerns highlighted in the May Report regarding budget deficits.

Norman maintained close relations with German Central Bank President Hjalmar Schacht, who served as Reichsbank President and Minister of Economics under Hitler. Both men were affiliated with the Anglo-German Fellowship and participated in the Bank for International Settlements. Additionally, Norman was godfather to one of Schacht’s grandchildren.

Subsequent inquiries revealed that Norman knowingly approved transfers of Czech gold reserves into accounts managed by the German Reichsbank during 1939, thereby enabling Nazi Germany’s access to these funds prior to World War II’s outbreak. Later that year, British government authorities intervened to prevent any further such transactions. Norman stepped down from his role at the Bank of England in 1944.

Honours

Following his retirement, he was granted the title of Baron Norman, of St Clere in Kent, on 13 October 1944. Norman received the Distinguished Service Order, was appointed to the Privy Council in 1923, and honored as a Grand Officer of the Order of the Crown.

Personal life

On 2 November 1933, Norman wed Priscilla Cecilia Maria Reyntiens, a London councillor and granddaughter of Montagu Bertie, 7th Earl of Abingdon. Through this marriage, he acquired two stepsons: Sir Simon Towneley and Sir Peregrine Worsthorne. The couple did not have children; upon his passing, Norman bequeathed the majority of his estate to his nephew, Brigadier Hugh Norman.

In 1944, while visiting his brother’s property in Hertfordshire, Norman experienced a fall that resulted in a fatal injury. A story recounted by Bill Bryson about Norman stumbling over a cow remains unverified by family members.

Starting in 1904, Norman lived at Thorpe Lodge in Kensington, which he refurbished alongside Walter Knight Shirley and Ernest Gimson following the Arts and Crafts movement. He passed away there in 1950 after suffering a stroke. The residence was later incorporated into Holland Park School.

Additionally, he maintained a residence at the Manor of St Clere in Kemsing, Kent, which he acquired from his uncle in 1935.

Further reading

• Ahamed, Liaquat, Lords of Finance: The Bankers Who Broke the World, Penguin Books, 2009.
• Boyle, Andrew, Montagu Norman. A Biography, Cassell, 1967.
• Hargrave, John, Professor Skinner alias Montagu Norman, Wells Gardner, Darton & Co., 1939.

External links

• Banking with Hitler