Baron Guy de Rothschild, who died on Tuesday aged 98, was the head of the French branch of his famous family and responsible for restoring the fortunes of the Rothschild bank in Paris after the Second World War.

In 1940, after the German victory in France, Guy de Rothschild’s father and uncles were deprived of their French nationality, struck off the register of the Legion d’honneur and stripped of their extensive possessions. It was announced that they had “abandoned French soil” in the face of the Germans; as Guy de Rothschild put it, they were guilty of “fleeing from the German army instead of volunteering for cremation”.

The Rothschilds had had the foresight, after the Munich agreement with Hitler, to open an office away from Paris at La Bourbole, near Clermont-Ferrand. But although, under the Armistice, La Bourbole was in the Free Zone of France, Alibert, the Vichy Minister of Justice, declared his particular intention of using the anti-Jewish laws “to get at the Rothschilds.”

In the summer of 1940 Guy de Rothschild took command at La Bourbole. Fortunately, the official appointed to carry out the sale of the bank’s property was not overzealous, and de Rothschild was able to find buyers who gave options for future repurchase — if ever “the Rothschilds should see better days again.”

When Guy de Rothschild returned to Paris after the city’s liberation in August 1944, he discovered only a dozen people manning the offices of de Rothschild Freres in the rue Laffitte. Having recovered the family investments, he set about making the Rothschilds once more a force in France.

Gradually he took control of companies in which his family had previously been only passive shareholders. The Compagnie du Nord, with which the Rothschilds had been associated since its inception as the Compagnie du Chemin de Fer du Nord in 1845, became the linchpin of the bank’s post-war fortunes, with interests in oil, mining, shipping, cold storage, construction and hotels.

Perhaps Guy de Rothschild’s shrewdest move was to employ Georges Pompidou, the future President of France. Within a very short time Pompidou was in charge of the business, where he remained until he became prime minister in 1962.

By 1968 the balance sheet was so healthy that Guy de Rothschild announced a grand restructuring of the business. At first there were difficulties. The bank’s oil interests in Algeria were nationalized; there were some disastrous property investments; and severe losses accrued from New Caledonian nickel. Nevertheless, by the end of 1980 the banking sector boasted 70,000 clients, while the firm’s industrial and commercial interests accounted for an annual turnover of 26 billion francs.

So it was natural that Guy de Rothschild should feel it keenly when, in 1981, the country’s Socialist government nationalized the entire structure — in exchange, as he put it, “for a total indemnity amounting to 80 per cent of the value of the building on the rue Laffitte”. It was a bitter blow — all the more so since critics suggested that, had Rothschilds remained an investment bank, it would never have been nationalized.

“A Jew under Petain, a pariah under Mitterrand,” Guy de Rothschild wrote in a letter to Le Monde.

Guy Edouard Alphonse Paul de Rothschild, the son of Baron Edouard de Rothschild, was born in Paris on May 21 1909. He was a great-great grandson of Mayer Amschel Rothschild (1743-1812), the moneylender who founded the family banking business at Frankfurt-am-Main.

Through Mayer Amschel’s sons, Rothschild banks were established in Vienna, Naples, Paris and London, in addition to the Frankfurt house. “As long as you remain united,” Mayer Amschel told his sons on his deathbed, “you will be strong and powerful; but the day you separate will mark the end of your prosperity.” It was the youngest son, James, who founded the bank in Paris.

The Rothschild businesses were most solidly established in London and Paris. But whereas NM Rothschild & Sons had exploited London’s pre-eminence as a financial center to become an important merchant bank, in Paris de Rothschild Freres’ operations were chiefly — and successfully — directed to the management of the family’s own fortune.

Rothschild grew up in an atmosphere of extraordinary opulence. His parents’ house in Paris, at the corner of the rue de Rivoli and the Place de la Concorde, had once been inhabited by Talleyrand.

Rothschild was brought up in a strongly Anglophile atmosphere. Having learned to ride at the age of five, he was glad to leave school for military service in the cavalry at Saumur. In 1931, he started work at Rothschild Freres.

But Rothschild also relished his pleasures. He became a fine golfer who played in the French team and in 1948 won the Grand Prix de Sud-Ouest.

On the outbreak of the Second World War, Rothschild became an army commander. After an engagement at Carvin, however, only three out of the 27 officers remained. He tried to return in 1943, but his ship was torpedoed, and he spent 12 hours in freezing conditions on a raft in mid-Atlantic before being picked up by a corvette. When he reached London his cousin Jimmy welcomed him with a bottle of 1895 Chateau Lafite. He was a Rothschild again.

In July 1944 he was assigned to the Allied Expeditionary Force, near Portsmouth. And so to Paris.

In 1949 de Rothschild began to turn his attention seriously to racing, and the next year won the Grand Prix de Paris with Vieux Manoir, the Grand Prix de St Cloud with Ocarina, and the Grand Prix de Deauville with Alizier. Thereafter his success became more spasmodic – though Exbury (named after his English cousin Eddy’s country house in Hampshire) won the Prix de l’Arc de Triomphe in 1963.

Guy de Rothschild’s second wife Marie-Helene (nee van Zuylen de Nyevelt), whom he married in 1957, when he was 47, swept him up, a willing victim, into the social whirl. She set about restoring the Chateau de Ferrieres. They gave many memorable parties there, notably the Proust Ball in 1971 and the Surrealist Ball in 1972. Not long afterwards Guy de Rothschild gave Ferrieres to the University of Paris.

Although Guy de Rothschild held that the overwhelming majority of the French were not anti-Semitic, he constantly came across particular instances to the contrary. As President of the Fonds Social Juif Unifie, he found it quite impossible to persuade de Gaulle to attend any specifically Jewish events. It was the General’s view that the Jewish people were “dominating and sure of themselves.”

In the wake of the bank’s nationalization, Guy de Rothschild moved the base of his business operations to New York.

In 1985 he published a volume of autobiography, “Contre Bonne Fortune” (translated into English as “The Whims of Fortune”).