Immediately upon the outbreak of war, new Trading with the Enemy legislation placed heavy controls on the bank accounts of citizens of enemy states. Banks were responsible for ensuring they operated within the new regulations. They were also warned to be on the look-out for bombs being planted on their premises in safe custody parcels. One Manchester bank advised branch managers to pay particular attention to deposits ‘from other than English customers or English servants’.
Such a tense atmosphere could make things very difficult for people with German-sounding names. Naturalised British subjects were not covered by the Trading with the Enemy regulations, even if they had been born in Germany. Nevertheless, banks were responsible for determining each customer's legal status, and sometimes got it wrong. There were stories of over-zealous bank clerks refusing transactions that should have been accepted.
British customers who dealt with enemy companies or individuals were also affected. One was John Malloch, a Manchester cotton merchant and customer of Williams Deacon’s Bank. He bought his supplies of Egyptian cotton through a German agent, H Bindernagel, but this arrangement was not allowed to continue after war was declared. Sometimes licences to trade with enemy firms were granted, particularly in industries like Malloch's, whose outputs supported the war effort. In this case, however, any prospect of a special licence disappeared when it emerged that Herr Bindernagel himself was fighting in the German army.
Malloch’s business needed cotton from Alexandria. There were other trading houses he could approach, but they already had plenty of customers. With materials in shorter supply than buyers, they had no reason to give Malloch an attractive deal. In October 1914, he decided to go to Alexandria himself to buy the cotton without a middleman. He approached Williams Deacon’s to ask for letters of introduction to banks there. The bank was happy to provide these, but thought he’d need more help. It gave him a letter of credit for £50,000. With this large sum at his disposal, he’d have much greater bargaining power.
Malloch makes no further appearances in the bank’s wartime memorandum book, so we do not know how his trip to Alexandria turned out. We do know, however, that he continued trading well into the 1920s, so it seems his business survived the difficulties that arose from the Bindernagel connection.