The Knights Templar

May, Everard sailed from Antioch to Acre, where he raised sufficient capital to fund the rest of the crusade, either by drawing directly from the treasury at the Templar preceptory in Acre, or by borrowing using the Order’s possessions as security. Whichever was the case, it proved that the Templars had become a major financial institution, and it cemented the relationship between the Order and the French crown, with the result that the Templars effectively became the French royal treasury until the late thirteenth century.

The Templars seem to have played a less prominent role in the remainder of the crusade. A council of war was convened at Acre in June to decide on a course of action, with the Templar Grand Master Robert de Craon present, together with the Grand Master of the Hospital, Raymond du Puy. After debating whether they should head for Edessa via Aleppo, or whether they should instead strike out for Ascalon in the south, it was eventually decided that the target should be Damascus, which the crusaders planned to attack the following month. After initial success in besieging the city from the west, the crusaders made the tactical blunder of decamping to a position on the east of the city. Unlike their original position, which had been well supplied, this new eastern position had no water and also faced the best fortified section of the city walls. With rumours that a huge Muslim army under Zengi’s son Nur ed-Din (Zengi having died in 1146) was on its way, the crusaders lost their nerve and retreated. The Second Crusade was over, and the recriminations for its failure began.

There were various theories as to why the Second Crusade had been such a fiasco. Accusations of treachery abounded, with various parties being named as the chief culprits. The crusaders, unused to life in the East, were shocked by the way Christians in Outremer had assimilated Eastern ways, and the ‘Men of Jerusalem’, as they were called, were seen as the guilty party by a number of commentators in the West. John of Wurzburg, a German monk who travelled to Outremer in the 1160s, believed that the Crusade’s failure was due to Templar treachery. John’s anonymous colleague, known as the Wurzburg Annalist, went even further, and stated that the Templars had been paid off by the Damascenes to lift the siege. Only later was it found that the money the Orders had been paid was in fact counterfeit, which was seen as Divine punishment for betraying the Christian cause. Other variants of the story had the ‘Men of Jerusalem’ accepting the money, while the early thirteenth-century chronicle of Ernoul and Bernard the Treasurer had the Hospitallers working alongside the Templars in putting profit before God. However, the Military Orders’ sternest critic of the time, William of Tyre, does not mention either the Templars or the Hospitallers in connection with the failure of the Crusade. As the bad press the orders received dates from several decades later, it would seem that the chroniclers were reflecting contemporary disillusion with both the Temple and the Hospital and projecting it back to 1148.

Given that the Templars played a major role in financing the Second Crusade, it might be worth examining the role the Order played in the financial affairs of both Outremer and the West, and the subsequent dominance they exerted over what was to evolve into a system of international banking.

The Temple as Bankers

The Templars quite early on in their history developed a reputation for being reliable bankers. They were – in effect – Europe’s first bank. They developed a system of credit notes whereby money deposited in one Templar preceptory could be withdrawn at another upon production of a credit note. Monies thus deposited proved to be quite safe, as Templar keeps were formidable buildings. Some of their castles in Outremer, for instance, were so well defended that they were impregnable (such as their massive fortress at ’Atlit, which was actually a fortified peninsula rather than a mere castle). In Europe, the imposing edifice of the Paris Temple became their financial base (as did, to a lesser extent, the London Temple).

Louis VII was the first of a number of European monarchs whose finances were saved from collapse by Templar loans, although the size of the loan that the Templars provided brought the Order close to bankruptcy. It is thought that the Order provided him with 2,000 marks of silver and 30,000 livres parisis. The magnitude of this amount of money can be seen when it is compared to revenues from French royal lands which, even 20 or so years after the Second Crusade, were only about 60,000 livres parisis per year.

Louis VII was not the only French monarch who was to become reliant on the Order’s financial services. The Second Crusade saw the beginning of a long association between the Order and the kings of France. By the reign of Philip II (1180–1223), the Templars were effectively the French royal treasury. During the course of his reign, they increased the revenues from royal estates by 120 per cent, and were heavily involved in Philip’s restructuring of Capetian finances. During the thirteenth century, the Templar treasurer in Paris was always a man selected by the king, and the treasurers became trusted advisers to Philip and his successors. When Louis’ great- grandson, Louis IX, was held hostage after the disasters of the Seventh Crusade in 1250, it was to the Temple that the French commanders looked for the remaining 30,000 livres that they required to bail him out (although, on this occasion the Templar commander, Stephen of Otricourt, was less than happy to comply).

That the Templars proved themselves to be so successful as bankers is due in no large part to the meticulousness of their records, and their objectivity in dealing with clients. Records survive from the Paris Temple for the period 12 March 1295 to 4 July the following year, and they give a clear indication of how busy the Paris Temple was in its role as banker. These records – eight surviving sheets of parchment – record the date and the Templar on duty at the time, in addition to the amount deposited, by whom, into which account the money should be paid and from where the amount came from. At the end of each day, the receipts collected would be taken to the strong rooms to be deposited. (During the 1260s and 1270s, a great tower was built in order to house the various monies the Order was keeping.) There were more than 60 active accounts at the Paris Temple during this period, with the account holders being a mixture of royalty, clergy, important nobles and Templar officials. No business was done at Christmas, Easter and Ascension, and also on the Feast Days of saints who had a particular relevance for the Order, such as John the Baptist. Outside of these dates, the hours the Temple was open for business depended largely on the needs of its clients. In August 1295, for instance, they were only open for six days, whereas that December, they were far busier, being at one point open on 11 consecutive days. The Paris Temple also sent out statements to important clients several times a year, detailing the movements within their accounts.

Matters did not always go smoothly, however, as the chronicler Joinville discovered to his cost on the Seventh Crusade. While the army was recuperating at Acre following King Louis’ ransom, Joinville received 400 livres in wages. He kept 40 and deposited the remaining 360 with the Templars. When he sent one of his men to withdraw another 40 for current living expenses, the Templar treasurer denied all knowledge of Joinville and his savings. Joinville then complained to the newly elected Grand Master, Reginald de Vichiers, who was initially dubious at Joinville’s accusation that the treasurer had lost his money. Reginald looked into the matter, and several days later was able to report to a much relieved Joinville that his money had been found; the treasurer was transferred out of Acre.

The Papacy also came to be dependent on the Templars for its financial needs. The Templars were acting as Pope Alexander III’s (1159–81) bankers from as early as 1163, and, as they had been involved with the overhaul of Capetian finances under Philip II, so the Order was also used by Pope Innocent III when he undertook to reorganise crusading finances at the time of the Fourth Crusade (1202–4). A new tax, levied on the clergy for the express purpose of being used to fund the campaigns in the East, was to be paid into Templar and Hospitaller preceptories; the military orders would then be responsible for transporting the money safely to the Holy Land. A similar procedure was followed by Honorius III when he was raising funds for the Fifth Crusade (1218–21), with the money raised to be transferred to the papal legate in Egypt.

Kings from other countries likewise came to the Temple. The kings of Aragon were heavy borrowers, and King Henry II of England (1154–89) used the Order to accumulate crusading funds in Jerusalem, whilst his brother King John (1199–1216) was borrowing anything from nine marks of gold for an offering to be made when he was absolved following the lifting of his excommunication in 1213, to loans of over 4,000 marks two years later to pay the wages of troops in Poitou and Gascony. During his wars with the barons, John’s son Henry III (1216–72) moved the crown jewels to the Paris Temple for safekeeping in 1261, where they were inventoried and stored until further notice. The further notice duly came three years later, when Henry used them as security on a loan to finance further campaigns against the barons.