Money and banks in Florence


Introduction

The Florin

There are several places that showcase Florence in 1252, the year the golden florin was first created. History lovers have the chance to learn more about the basic organizational structure that formed the backbone of the world’s modern banking system and economy. Many people throughout Europe would only conduct business in gold florins, the coin of Florence, as it was considered the most stable and widely spread.
It was the first gold currency in Europe to be struck in significant quantities since the seventh century. It was also a standard size at 54 grains of gold. The fact that there were Florentine banks all over Europe made it the coin of choice for large scale transactions.

Trittico di San Matteo: 'La chiamata di San Matteo'. Il Santo abbandona il banco da gabelliere per seguire il Cristo

The Medici

 

After the bankruptcy of the Bardi and the Peruzzi it was the Medici family who rose to power. The Medici bank was started by Giovanni di Bicci Medici in 1397 in Florence, and business flourished under his son, Cosimo de Medici, called the Elder, with branches in Venice, Rome, ( later in London, Bruges, Avignon, Milan, and Lyon)
It was after Cosimo’s death that the bank started to decline and branches started to fail. This was mainly due to the branches lending money to bad credit risks, such as the London branch lending to Edward IV. Further decline happened when his grandson, Lorenzo, referred to as “The Magnificent” for his great interest in the Arts, was not really interested in banking. The bank was dissolved two years after Lorenzo’s death.
Even in its decline, the Medici bank was the largest in Europe and contributed in a major way to the development of the banking system, inventing  the general ledger system of debits and credits, the birth of the double entry accounting system.

The tour

 

Lorenzo Ghiberti (Florence 1378 or 1381–1455), St. Matthew, 1419–22, bronze, silver and traces of gilding, 272 x 135 x 70 cm. Florence, Chiesa e Museo di Orsanmichele Credit line: Photograph by Lorenzo Mennonna

Many Florentine merchants’ families invested considerable amounts of money in the decoration of chapels and churches, primarily to  ask for forgiveness, as the Catholic Church was against usurers and money lending. At the same time the splendid artworks strengthened the social status the family had conquered.

An important stop is the Chapel of Francesco Sassetti in the Church of Santa Trinita.. The commissioner’s family and Lorenzo the Magnificent with his descendants are depicted in these works by Domenico Ghirlandaio. Also on the Via Tornabuoni, nestled among the luxury residences of the historical families Palazzo Strozzi stands out with its massive stones and gigantic street lamps in cast iron. Not surprisingly the Italian word for pawnbroker is “strozzino”!

The Tabernacle of the Arte del Cambio (guild of money changers, aka bankers) is one of fourteen niches containing statues of the guilds patron saints and decorating the outer wall of Orsanmichele, the church of the guilds and that is also a celebratory monument of the entrepreneurial abilities of the Florentines. On the Campanile (bell-tower) of the Cathedral you will see reliefs dedicated to the work of man including a depiction of a typical weaving loom, witnessing the importance of this activity in 14th century Florence.

 

To complete our overview it is worthwhile to stop at the Oratory of the Buonomini di San Martino. The congregation was founded in the 15th century by Saint Antonino, bishop of Florence and a fierce opponent of the excesses of finance and banking. The Buonomini helped families in financial trouble in different stages of life. Restored in the spring of 2011, this is the only Florentine painting cycle of the period with a non-religious theme, offering us a detailed description of daily life events.

 

Extras and detours:

Most Florentine churches host myriad chapels commissioned by merchant families. In Santa Maria Novella you will find those of the Bardi, Rucellai, Strozzi and Gondi families. Its largest chapel, hosting Ghirlandaio’s frescoes, belonged to Giovanni Tornabuoni, an uncle of Lorenzo the Magnificent and a treasurer to the pope.
The Basilica di Santa Croce hosts the chapels of various banking families like Peruzzi, and Pazzi. Likewise, Cosimo de Medici commissioned a wing of the convent and Tommaso Spinelli, and the treasurer of Pope Paolo II, funded the construction of its fifteenth-century cloister.
The Basilica di San Lorenzo and Palazzo Medici are of course emblems of Medici power and fortune and are part of our Medici tour. Even the public library Oblate is hosted in a complex that was originally a hospital founded by Folco Portinari, banker. The Brancacci Chapel’s stunning frescoes by Masolino and Masaccio are linked to an ambassadorial event centered on the Sultan of Egypt (1422) and its commissioner Felice Brancacci, who was involved in the silk trade.