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Produced and published by the School of Historical & Philosophical Studies, The University of Melbourne
Published July 2008
Published July 2008
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The Gabrielli Loan was the first significant Victorian overseas government borrowing, and an important early association of banking and finance with the development of city infrastructure.
Gold-rush Melbourne experienced spectacular population growth, which placed severe strain on resources. For the Melbourne City Council (MCC) this was also a time of political trial. Separation and the creation of the Parliament of Victoria meant the citizens had a new instrument of government to remedy the city's deficiencies, the obvious examples of which were the unmade roads. Antonio ('Anthony') Gabrielli (c. 1814-91) was a travelling merchant and financier with offices in Bombay and Old Broad Street, London, who arrived in Melbourne in April 1853, on the steamer Harbinger. Believed to have access to Rothschild funds, in July he offered a £500 000 loan to the city. But the MCC was restricted in its borrowing capacity. After discussions between the City Council and Legislative Council, a Select Committee on the Administration of Local Funds was formed in December 1853, before which Gabrielli appeared as an eloquent witness. He then proposed a loan of £stg1 million (the City of Geelong was also involved) be raised in London, bearing interest at 6% with the town rates as security and the colonial government agreeing to endow the City Council for 40 years with £25 000 to form a sinking fund. Clearly persuaded, the Legislative Council passed enabling legislation in April 1854. The Victorian Parliament guaranteed the loan, which the two councils were to repay in 21 years through rates revenue. According to the banker historian, Henry Gyles Turner, Gabrielli arranged an interim advance from the Bank of Australasia and placed the debentures on the stock exchange of London, his premium of £25 000 'probably the reward of his own astuteness'. The streets of Melbourne were formed as a result. Gabrielli encouraged inexperienced colonial magnates to undertake necessary public works and he showed them how they might be financed.