Authors: Robbins Harold
Robert looked down at the boat dock off which their English yacht was at anchor. "Not me, I haven't the energy of you English." He got to his feet slowly and stretched. "The only decent thing to do after a lunch like this is to take a nap."
He crossed the terrace and went into the house just as Denisonde came out. "Where are you going?"
Robert grinned. "I'm going upstairs to take a nap."
"Why don't you stretch out in the sun?" she asked. "You can sleep just as well there, and you'll get some color in your face. What's the sense of coming to the Riviera if not for that? You could just as well have stayed at the bank if you're going to spend all your time indoors."
Robert stood looking at her indulgently. "Finished?"
"Yes."
"What are you doing?"
"I'm bringing your father his medicine. If I don't remind him he'll never take it."
"Bien. When you've done that come upstairs and I will show you why it is always better to take a nap indoors."
It was after midnight and the big villa was silent when Robert made his way down to the library in search of something to read. He opened the door and as he went directly to the bibliotheque, his father's voice came from directly behind him. "You are awake?"
Robert turned. The baron was seated in one of the deep easy chairs. "I could not sleep," Robert said. "I expect I slept too much this afternoon. But why are you awake?"
"I am old," his father replied. "When you are old you don't need as much sleep."
Robert smiled and took a book down from the shelf. Idly he glanced through it.
"Our cousin thinks it's time our banks merged," the baron said unexpectedly.
Robert looked up from the book. "What do you think?"
"Many years ago it was the ambition of my grandfather —one bank that would blanket all Europe." The baron looked up at Robert. "It was not such a bad idea then, perhaps it is an even better one now. The American banks grow larger every day, and even the Morgan bank is thinking of a merger. The American banks are our strongest competition. If our resources were pooled we could match them on any deal."
"I don't like it," Robert said suddenly.
The baron seemed curious. "Do you have a reason?"
"Not really. I just feel a merger would cost us our independence. We would not be able to act as freely as we do now."
"I am not at all convinced it would not be to our advantage. Certainly our cousin has been successful. His bank is twice the size of ours."
"That is no true measure," Robert replied quickly. "Not once have they had to suspend operations because of war or a change in government. How many have we had since the time of Napoleon? And each time we have had to rebuild from the ground up. Sir Robert was fortunate in having a continuous, stable government during all that time."
"Then a merger might be advantageous. Wars and governments would no longer affect us if our business was centered in London."
"If we're concerned only with safety, why not move our headquarters to New York? There we would be even safer."
The baron looked at him shrewdly. "You do not like our cousin, I gather."
Robert stared back at him for a moment. "No, I do not."
His father did not ask his reasons. "Even as a boy Sir Robert was always ambitious."
"If that were all I sensed in him I would not be worried."
The baron looked up. "You think he wants to control our bank, too?"
"Wouldn't he?" Robert asked. "You've admitted his is twice the size of ours. Is it not normal that the shark eats the sardines?"
"Perhaps. But aren't you forgetting one thing? I have a son, and Sir Robert has only daughters. The bylaws of both banks are similar in one respect. Only sons may inherit control. Our grandfather saw to that."
"But the sons of daughters may inherit," Robert said. "Already three of his five grandchildren are sons."
"Sons. That was the secret strength of the Rothschilds. They bred sons. We have not been so lucky—perhaps one to a generation. Sir Robert and I were the only ones in ours, you the only one in yours. And you have but one." He smiled suddenly at Robert. "What are you waiting for? You must apply yourself!"
Robert laughed. "I'm doing the best I can, Papa."
Robert looked down at the sheet of paper, then up at the accountant. "You've made no mistakes on this?"
The accountant shook his head. "Everything is verified, sir."
"Thank you."
Robert sat thoughtfully for a moment. For months someone had been buying up all the bank's paper and he had not until now been able to ascertain who. Now he knew. He should have realized before. He should have been aware that Sir Robert would not come to his father without a card up his sleeve; he was far too professional not to be prepared for a refusal. Suddenly it was all clear, even where Campion had got the money to meet his note.
He got up and with the sheet of paper in his hand went down to his father's office. He knocked and went in. "Did you know about this?" he asked, placing the paper in front of the baron.
The baron looked down at it. "I guessed as much," he admitted, "but I could not be sure."
"Then why didn't you stop him?" Robert asked. "He has almost enough of our paper to put us out of business."
The baron shrugged and leaned back in his chair. "I couldn't see quite what difference it would make once we merged."
"You're not going to let him push us into a merger?"
"There is very little else I can do," the baron said. "I am old. I am tired. I have not the strength for another battle with our cousin."
Robert stared at his father angrily. "You may not, but I have! I will not let you trade away my children's future because yours has already passed. I will find a way to stop that greedy cousin of ours!" He stormed out of the office, slamming the door behind him.
The baron looked at the closed door for a moment, then slowly began to smile. He had waited a long time for this moment. When Robert would admit that he cared as much about the bank as he did. That Robert wanted it for his son as he had wanted it for Robert.
Now he could do what he wanted with a clear conscience. At last he could retire.
CHAPTER 17
Slowly Robert turned the pages of the confidential ledger until he found what he sought. Then he sat there, studying the figures. This could be the answer. It all depended on how greedy Sir Robert really was.
Capital had always been the problem. It always was with a private bank. A publicly held bank had many ways of increasing its capital. It could merely issue stock to extend its capitalization if it should so desire. But De Coyne's was a private bank. There were no shareholders outside of the family. That was the way it had always been. They accounted to no one except themselves.
Many years ago his father had solved the problem of improving the bank's cash working position without borrowing money or diluting their ownership. He began to sell short-term notes at minimal discount. The reputation of the bank was such that the response was immediate. The public bought the notes without hesitation, in preference to other offerings promising greater gain, because they felt there was no risk. Never in the almost one hundred years of its existence had the De Coyne bank failed to meet an obligation. Before long such notes developed a reputation for being more stable than many of the currencies of Europe. Perhaps one of the reasons was that they were always payable in dollars, and in any country in the world.
Wisely the baron had anticipated the problem of the notes being hoarded and to counteract this he set up a repayment program. Ten percent of the notes outstanding were redeemable each year for new notes or for cash. To make certain of their redemption, interest was paid on the notes only until their due date; after that no interest was earned.
The plan had worked very well until almost five years ago when a small percentage of the notes due had not been presented either for exchange or for redemption. Automatically a transfer had been effected from working cash to reserve. It had grown with each succeeding year until now almost twenty million dollars lay idle in that reserve account.
Robert calculated swiftly. This money held in reserve alone meant a net reduction in possible earnings to the bank of close to three million dollars, the difference between what this sum could have earned and the interest they paid on the notes. But it meant something even more important. It limited the bank's ability to enter into new ventures and reduced their competitive position in the money market.
Robert stared down at the page in front of him. Right there lay the answer, if it worked. The Corteguayan investments, by far the most profitable the bank had. While it was true they had only a half-interest, since Sir Robert's bank in England held the other half, their share alone represented almost nineteen million dollars. Their profit from this was almost five million dollars a year.
Robert toyed idly with his pencil. It was a big profit to forego. Almost two-thirds of the total earnings of the bank after all operational expenses had been met. But it would be a bargain if it got their paper out of the grasp of the baron's English cousin. It would have to be handled delicately. Sir Robert must rise to the bait without ever becoming aware who was holding the other end of the line. Robert reached for the telephone.
"See if you can locate Monsieur Xenos for me." He listened to his secretary for a moment, then added, "Anywhere in the world. It is vital I speak with him."
Two young men were seated on either side of Sir Robert's desk when Dax was shown into the office. They both rose as Sir Robert extended his hand. "It's good of you to drop in, Dax. It's been a long time."
Dax took his hand, smiling. "Yes, sir, it has."
"You haven't met my sons-in-law, Victor Wadleigh and John Staunton."
"Mr. Wadleigh, Mr. Staunton."
"Please sit down," Sir Robert said, sinking back into his chair. "I suppose you're wondering why I asked to see you?"
"Not really," Dax replied. "I have a faint idea." He cast a questioning look at the two young men.
"You may speak frankly," Sir Robert said quickly. "They're both in the bank and quite privy to my affairs."
Dax nodded and smiled. "I imagine it's about the Corteguayan investments?"
"Exactly," Sir Robert said. He glanced at his sons-in-law, then back at Dax. "We've learned that you started negotiation with the baron's bank for the acquisition of their holdings in Corteguay."
"That's true," Dax admitted.
"I was not aware that you were still active in the affairs of your country."
"I'm not," Dax replied. "Actually, I am not acting for myself or for Corteguay. I represent a syndicate interested in the acquisition." He reached for a cigarette, and one of the young men sprang up to light it for him. "After what happened to me I have learned, though rather late in life, I must admit, that I have to look after myself."
Sir Robert nodded. This kind of language he had no difficulty in understanding. "I must say you have been treated rather shabbily after all you've done."
Dax did not answer.
"This group you represent—they're Americans, I imagine?"
Dax smiled. "That much I can admit."
"You wouldn't be at liberty to disclose to us just who they might be?"
Dax shook his head. "I could not disclose that even to you, Sir Robert."
"You are aware, of course, that we hold an equal investment in Corteguay and that our agreement would be necessary before the baron could sell your group his share?"
Dax nodded. "Robert mentioned that, but he said he expected no difficulty. He explained that he could always count on your cooperation."
Sir Robert was silent. The baron must be feeling the squeeze if he was considering such a sale. The Corteguayan investment was the most profitable the two banks had ever made. He also realized that he dared not withhold approval if the baron asked. If he did the baron would never consent to a merger.
In a way he felt himself between the devil and the deep blue sea. If he approved the deal, there was all that profit gone. If he withheld his approval, however, there would be open war between himself and the baron and no merger could be effectuated. Unless there was another way.
That was it, he thought suddenly, there was a third way. True, it would mean that the merger would have to be put off for a while. But even that was unimportant in the light of what would be gained for very little additional investment on his part.
He looked across the desk at Dax. In a way it would all depend on what Dax had meant when he said he had to look after himself. Sir Robert hesitated for a moment, remembering their conflict of many years ago. But only for a moment. Then his greed betrayed him into thinking that eventually all men came to be motivated by money. Rapidly he began to speak.
Robert could scarcely believe the triumph he felt, and in his elation he lapsed into an Americanism. "You mean he bit?"
Dax smiled. "Hook, line, and sinker."
The baron looked from one to the other, slightly puzzled. "Explain it to me."
Robert turned to his father. "When our honorable cousin learned that the Corteguayan investments might go elsewhere, he decided to buy them for himself. First he bought Dax off by offering him twice as much as he thought the mythical syndicate was offering. Then he met what he thought was the syndicate's offer, twenty-five million dollars, the only provision being that instead of cash, twenty million would be in our own paper."
The baron smiled. "And what did you do?" Robert smiled back at him. "What could I do? After all, blood is thicker than water, so I had to accept. His sons-in-law have just returned to London with the signed agreement." The baron looked at Dax. "You have done well." "Thank you," Dax replied, "though I really did nothing. I was merely the errand boy; it was all Robert's idea. I feel guilty about accepting your money."
"You shouldn't, you have earned it." The baron turned to his son. "You, too, have done well."
Robert smiled. Praise from his father was very rare. "I have something for you." He opened the briefcase which he had brought into his father's office and spread out the ornately printed forms upon his desk. "The paper—twenty million dollars' worth."