(BY A SCOTTISH CORRESPONDENT.)
THE forthcoming Centenary of the Union Bank of Scotland, which will be reached in 1930, will naturally cause some attention to be focussed upon the particular area identified with its origin and development. The His- tory of the Institution,, at present in process of com- pilation, will add a fresh chapter to the commercial annals of the country, and, taken in conjunction with the story of the Royal Bank, published in 1928, will embody a record of progress in which Scottish banking generally has played an important part. So far as the West of Scotland is concerned, the expansion, in the Clyde area— although it had its roots in the Union of the Parlia- ments—was in the main a development associated with a much later period. The nineteenth century Was the age in which industrial progress became definitely marked. Steam looms superseded hand weaving ; the railway took the place of the pack-horse and the stage-coach ; docks became a natural corollary to improved waterways, and a steady growth in population became the order of the day as the possibilities of the Western seaboard assumed a more practical aspect. The population of Glasgow in 1745 was only 23,000. By the beginning of the nineteenth century it was round about 80,000, and even then no Scottish town exceeded 100,000. A census of the whole of Scotland showed a little over one and a half millions. To-day the total population is in the neighbourhood of 5,000,000, of which probably one-half is centred in the West, Glasgow itself claiming a fourth of the entire population.
Prior to 1750 there were no actual banks in the City of Glasgow, the modest requirements of the community having been so far met by trading firms who conducted discount business and accepted money on deposit on more or less arbitrary terms. Several companies con- trolled by Tobacco Lords—or Virginia Dons as they were then called—combined banking with general trading, and money brokers followed in their wake for exchange and underwriting business. As early as 1696, and again in 1731, attempts had been made by the Bank of Scotland to establish an outpost in the West, but the efforts were handicapped, through a conservatism which declined to discount bills Unless on the endorsement of an Edinburgh citizen of approved standing.
BANKING IN GLASGOW.
With commendable enterprise the Royal Bank opened its first office outside Edinburgh in 1783, and Glasgow was the objective. The present Glasgow Office of the Bank of Scotland dates from 1804. Edinburgh was the recognized business and social centre of eighteenth- century life in Scotland, and the old banks were slow to appreciate the needs and the opportunities afforded for expansion in the rising mercantile community of the West. As late as 1800 the three old banks had only forty- one branches among them, and most of these were con- cerned with agricultural interests. The requirements of the Glasgow district were, however, satisfactorily met by local enterprise through the establishment of the Ship Bank in 1750. The bank was run by six of the most influ- ential merchants in the City under the firm name of Dunlop Houston and Co., and after an honourable span of eighty-six years it merged its fortunes in the Glasgow Banking Company—an institution con- ceived and conducted on similar high-class lines. The fusion became in 1843 an integral part of the Union Bank of Scotland. A few years earlier the business of the old and respected Thistle Bank, established in 1761, had also been acquired. In 1838 the Paisley Union Bank was taken over, and the same year witnessed an affiliation with the private bank of Sir William Forbes, James Hunter- and Co., the successors of Coutts. This gave the Union Bank an important Edinburgh connexion and a new head office in the Scottish capital. Through its absorption of the Ship Bank, the Union Bank of Scotland has the proud claim of being identified with the very beginnings of banking in the West of Scotland, and it has consistently developed in Glasgow, as elsewhere, with a due regard to district requirements.
When Queen Victoria came to the throne in 1837 Scotland had twenty-four banks and 274 bank offices. Deposits at that period have been estimated at round about 125,000,000. In the following year six new Joint Stock Banks were established, the most important being the Clydesdale Banking Com- pany, which commenced business in Glasgow on a paid-up capital of 1375,000. The Clydesdale Bank is the sole survivor of the establishments promoted in 1838. In the early stages of its career it operated only through its main office in Glasgow and a branch in Edinburgh, but in course of time, through the absorption of some local concerns such as the Greenock Union Bank, the Edinburgh and Glasgow Bank, the Eastern Banking Company, and the Dundee Commercial Bank, a much wider connexion was assured. The Clydesdale is particularly strong in Western and South-Western districts.
GROWTH OF " WESTERN " BUSINF.SS.
Failures, withdrawals, and amalgamations have con- solidated Scottish banking to the compass of present dimensions, and eight Banks of Issue now cater for the needs of the community. Of these, four still remain independent banks and four are owned by London clearing banks. All of them publish Annual Reports and are under the direction of Scottish Boards ; but, of course, from a public point of view interest naturally centres in dividends paid by the institutions free of London control. Five of the banks have their head- quarters in Edinburgh ; two have their head offices in Glasgow, and one has its head office in Aberdeen. A con- siderable proportion of the branch offices are identified with the Glasgow area. Glasgow itself contains within its municipal area something like 250 separate offices, of which over seventy are branches of the Union and the Clydesdale. All the Scottish banks have now for many years directed special attention to their interests in the West, where the bulk of their lending business in Scotland is centred. The phenomenal expansion over the last twenty years may be instanced by the experience of the North of Scotland Bank, which only entered the City in 1910 in occupation of a modest office in St. Vincent Street, and which has recently built for itself an imposing edifice in the same neighbourhood, in addition to which it has now eight separate branches throughout the City. One of the handsomest buildings reared in Glasgow within recent years is the new Head Office of the Union Bank of Scotland, and directly opposite this is the new Renfield Street Office of the Bank of Scotland. Paisley, Greenock, Ayr, and other growing towns identified with the heavy industries, such as Clydebank, Coatbridge and Motherwell, have also since the century opened witne3sed a business development quite unparalleled hitherto in the domestic annals of the country. The development IA ould warrant the inference that the belt between Forth and Clyde and the industrial area immediately to the South and West are making a steady recovery, and that agri- culture, which is more prominent in the counties of Dumfries and Galloway, is also on the upward curve. A progressive extension of banking representation in a district shows a rising barometer as regards trading activity, and also suggests enhanced prospects in the direction of fresh deposits. The numerous channels through which the banks are now in a position to serve the public, and the wide powers which they enjoy through enlarged constitutions, are in practical evidence in many centres where a growing population seems to warrant fresh enterprise—the keenness of the competition being all in the public interest. It may be that in some dis- tricts the pace set in the direction of branch expansion has been barely remunerative to the banks concerned, as withdrawals have been noted in several instances, but no relaxation of energy seems apparent in the Western division, where Glasgow remains the pivot around which the bulk of Scottish industry continues to revolve.
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