Crédit Agricole 140 years of history : 1890s

While the Salins-les-Bains experience was a positive one, French farmers continued to face problems in the early 1890s and the government explored several ways of allowing them easier access to financing. These discussions led to the law of 5 November 1894 on “the creation of Crédit Agricole companies”. The Jura experience was put to good use and the government encouraged the creation of local banks with a cooperative structure throughout the country.

However, this law of 1894, which allowed farmers to join forces to finance their needs, soon reached its limits. The capital raised by the first local banks was not sufficient to meet all loan applications. In 1897, Jules Méline, Prime Minister, again asked the Banque de France to advance 40 million gold francs to the Crédit Agricole banks, repayable in 1920. This external contribution of funds gave Crédit Agricole real impetus to set up new local banks.

^1. Jules Méline, sponsor of the 1894 law on the creation of local banks.
^2. Albert Viger, sponsor of the 1899 law on the creation of regional banks.

Jules Méline, the sponsor of the 1894 law, praised the cooperative system and its impact on society: “Gentlemen, the main principle behind our project is the great and powerful lever with which we will, I am sure, raise and transform our society. With it alone, we will peacefully complete the changes that are afoot in the world of work”.

The creation of the regional banks

A new law, passed on 17 March 1899 and promoted by Albert Viger, organised the new financial structure. It led to the creation of the regional banks, which brought together the local mutual banks within their region, promoted mutualism in their regions and, most importantly, distributed government advances among the local banks according to their needs.

The distribution committee

At the higher level, a distribution committee comprising members of parliament and representatives of the regional banks was set up within the Ministry of Agriculture to distribute the advances.

The principle of mutualism was reflected in the institution’s governance.

The farmers who were mutual shareholders of the local mutual banks elected their directors and chairman, who represented the local banks with respect to their regional banks, which were in turn members of the distribution committee. As explained by Senator Victor Lourties, this structure made it possible to organise Crédit Agricole “from the bottom up”, allowing it to be as close as possible to farmers and local areas.

This decade of organisation reflects what will characterise Crédit Agricole throughout its history: a mutualist base, a cooperative structure and an important place for local initiatives, all facilitated by national guidelines.