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says Alexander, who has previously summed the policy up as ‘no potentates’. What is the definition of iffy? He draws a breath: ‘We know the niche where we’re comfortable and it doesn’t involve people with their own private armies.’ The bank also tends to steer clear of the
type of person who might be motivated by the prospect of having a smart chequebook – a stance that has surely helped to ensure that its name retains a cachet among those in the know. (One banker Spear’s spoke to noted: ‘People who think that Coutts is the smartest bank haven’t heard of Hoare’s.’) But there’s a final test too: ‘The important thing is that if people aren’t nice to deal with, you don’t want to look after them,’ says Venetia. ‘However profitable they are, it’s not worth it. That’s the joy of a family business: you’re not always looking at the bottom line.’ That bottom line still matters, of course. But if C. Hoare & Co. is going to survive – and thrive – for another 350 years, it will need to ensure that its succession plan continues to put sufficiently capable people in charge. As things stand, one or two branches of the family dominate the partnership. Four of today’s partners have fathers who were partners, while Rennie has an uncle and a grandfather who were partners. Is this state of affairs indicative of a model that selects on merit alone? Current partners point to the recent introduction of psychometric tests designed to select those most suited for the job. But still, possible applicants are drawn from the pool of around 2,500 cousins. James Hoare, a tenth-generation member of the family who left Goldman Sachs to join the Hoare’s wealth management business, notes that if the goal is ‘to have the right people in the right place at the right time with the right skillset and the desire to work there’, then ‘it’s not perhaps a big a pool as you might think’. He adds: ‘If you’re Goldman you’ve got the whole world.’
Another challenge facing the Hoare banking dynasty is that their business model is expensive. Traditional, personalised banking is not cheap – which is part of the reason so many other banks have stopped doing it. As a result, one of the bank’s strategic priorities is to improve its tech, partly to offer clients better digital services, but also to find savings in the business through process automation. CEO Diana Brightmore-Armour, a veteran of Lloyds Corporate Banking and Coca-Cola, is also overseeing a modest expansion which
Diana Brightmore- Armour joined the bank as CEO in 2021
includes the recruitment of bankers in Exeter and the North of England. They will work remotely, in order to be closer to existing customers outside London and Cambridge – and to attract new ones. Like the partners, she is convinced that artificial intelligence will never replace ‘deep, personal relationships’ in banking, though she admits that tech has gone from being a ‘nice to have’ to being a ‘hygiene factor’ in banking. In a recent newsletter, Alexander told clients that the IT department was now the largest department at the bank. C. Hoare & Co. does have a reputation for
being expensive. At the same time, however, industry observers noted to Spear’s that it also has a reputation for being able to reach decisions on big loans faster than almost any other bank. (One insider who knows of a materially significant loan approved by Hoare’s in just four days remarks: ‘You try doing that with a Swiss or American bank – it just isn’t going to happen.’) This model may be susceptible to
undercutting by newcomers eager to take a bite out of its most profitable business, but
there is always room at the top. And, after 30 years at the bank, Alexander Hoare says he has learned that ‘enough profits will flow’ – so long as the focus remains on the right things. ‘What I think a lot of organisations do,’ he says, ‘is they set a profit target and figure out how they’re going to hit it. And that’s completely not going to give optimal results.’ He adds: ‘This bank has sustained itself for 350 years without any outside capital and along the way has given back huge amounts to the community, so I think we’ve been a net positive for society for 11 generations.’ Whether C. Hoare & Co. can continue to do that for another 350 years and remain family-owned and family-run will rest on several things. ‘You have got to have a big slice of luck,’ admits Rennie. And, with the memory of the seventh generation still informing the bank’s prudent approach, you suspect the current partners will focus as keenly on succession as they ever have. The last thing the family needs is another batch of profligate, scandalous ‘rotters’. Fortunately, that doesn’t seem likely to arrive any time soon. S
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