Clydesdale Bank plc is a commercial bank in Scotland. Formed in Glasgow in 1838,
it is the smallest of the three Scottish banks. Independent until it was
purchased by the Midland Bank in 1920, it was sold to its present owners, the
National Australia Bank in 1987. NAB's other British subsidiary, Yorkshire
Bank, operates as a division of Clydesdale under its banking licence.
As with the two other Scottish banks, the Bank of Scotland and The Royal Bank
of Scotland, it retains the right to issue its own banknotes.
National Australia Bank confirmed in October 2014 that it planned to exit the
UK, and was considering a number of options for Yorkshire and Clydesdale
Banks, including a possible stock market listing. In October 2015, NAB confirmed
it would float Clydesdale Bank plc on the London Stock Exchange in February
2016 through an initial public offering, with an aim of raising £2bn.
History = Formation =
In March 1838, an advertisement appeared for a new joint stock banking company in
Glasgow, the Clydesdale Banking Company. It was to be "chiefly a local bank –
having few branches – but correspondents everywhere" though it was conceded that
a branch in Edinburgh would be necessary. The Bank duly opened for
business in both cities in May 1838. Checkland described the Bank as the
creation of "a group of Glasgow businessmen of middling order, liberal
radicals…who were active in the government and charities of the city."
The driving figure behind the formation of the Bank was James Lumsden, a
stationer by business, a councillor, police commissioner and, later, Lord
Provost of Glasgow. Another member of the founding committee, Henry Brock,
became the Bank's first manager. Brock came of a merchant family, was an
accountant and one of the founders of the Glasgow Savings Bank. Despite the
declaration in the advertisement, in the year after formation the Bank opened
three Glasgow branches as well as its first country branches in Campbeltown
and Falkirk; a further seven had been opened by 1844. These were supplemented
by the acquisition of the Greenock Union Bank; formed in 1840, it had four
branches in the Glasgow hinterland. = Expansion =
Following the purchase of the Greenock Union, there was little change in the
structure of the Bank and there were still only 13 branches in 1857. In that
year, Clydesdale became the first Scottish bank to produce a printed
balance sheet, and it showed assets of £2.7m and net profits of £70,000. The
public disclosure of its strength stood it in good stead for only months later
the Western Bank of Scotland closed its doors, followed the next day by the
first closure of the City of Glasgow Bank. Clydesdale gained not only
customers but 13 branches from the Western. A few months later came the
acquisition of the Edinburgh and Glasgow Bank, which had been weakened by the
same economic disturbances. The Edinburgh & Leith Bank, as it was
originally, had been formed in 1838 "for the benefit of the 'industrious middle
classes'" and it had bought the Dumfries-based Southern Bank of Scotland
in 1842 and the Glasgow Joint Stock Bank in 1844, the latter leading to the
change of name to Edinburgh & Glasgow Bank. Poor lending in the 1845–47
period, particularly to Australia, dogged the Bank for the next ten years
and it was eventually taken over by the Clydesdale for a nil consideration;
Clydesdale retained 19 of its 27 offices. Five years later, in 1863,
Clydesdale acquired the more successful Eastern Bank of Scotland, like
Clydesdale, also founded in 1838. Based in Dundee it was two have two separate
offices and boards, one in Dundee, the other Edinburgh. Before opening for
business it acquired the Dundee Commercial Bank to serve as its Dundee
office. Difficulties with the two boards working together led to the Edinburgh
bank being wound up and the Eastern became an essentially Dundee bank; its
acquisition gave Clydesdale its first interests north of the River Tay.
Much of the growth in the Bank's network had come from acquisitions and the
management remained cautious regarding direct branch expansion. However, in
1865, a committee was formed to look at prospects and 16 branches were opened in
two years. In 1874 the Clydesdale went south of the border and opened three
branches in Cumberland but this was seen as following existing trade rather than
making a specific attempt to enter the English market. Indeed, Clydesdale was
one of the last Scottish banks to acquire a London office. In 1878, the
City of Glasgow Bank failed for the second time, leading again to an
increase in Clydesdale's deposits and the acquisition of nine of the Glasgow
branches. The scale of the collapse led to further debate on desirability of
limited liability and, following legislation in 1879, Clydesdale Bank
registered as a limited liability company in 1882.
Reid described the period 1890–1914 as "the tranquil years", but that did not
preclude steady expansion of the branch network – from 92 to 153. That was to
mark the end of Clydesdale's independent existence. In 1917 the Bank was
approached by London City and Midland and, although initially resisted,
Clydesdale Bank was sold in 1920. However, it continued to operate
independently and was always referred to as an affiliate, not a subsidiary. The
Glasgow banks suffered more than others in the depressed economy of the
inter-war period and from being the largest lender in Scotland in 1920, it
fell to fifth place by 1939. Despite this, the Bank continued to open
branches, particularly in areas enjoying export growth, and the network increased
from 158 in 1919 to 205 in 1939. = The Midland Era =
Midland had also acquired the North of Scotland Bank in 1923 but the Aberdeen
management had fiercely resisted any attempt to merge with Clydesdale.
However, the changed competitive market after the Second World War meant that
the two banks could not remain separate and in 1950 they were amalgamated to
become the Clydesdale and North of Scotland Bank. Clydesdale had 189
branches and the North of Scotland 161, covering 221 towns between them. Of the
eight Scottish banks, Clydesdale had been the third largest by deposits, the
North being the smallest. The merged bank became Scotland's largest in terms
of deposits, advances and branches. However, by 1969, mergers elsewhere had
reduced the number of Scottish banks to three with Clydesdale now being the
smallest. Midland needed to rationalise the enlarged Clydesdale but faced
resistance. Midland also needed additional capital and its solution to
both challenges was to sell Clydesdale to National Bank of Australia in 1987.
Banknotes = Banknote history =
Until prevented by the Bank Charter Act 1844, privately owned banks in Great
Britain and Ireland were permitted to issue their own banknotes, and money
issued by provincial Scottish, English, Welsh and Irish banking companies
circulated freely as a means of payment. While the Bank of England eventually
gained a monopoly for issuing banknotes in England and Wales, banks in Scotland
and Northern Ireland retained the right to issue their own banknotes and
continue to do so to this day. In Scotland, Clydesdale Bank, along with
The Royal Bank of Scotland and Bank of Scotland, still prints its own
banknotes. = 2009 issue =
The current designs were released in autumn 2009. The obverse designs feature
famous Scots while the reverse designs feature Scotland's UNESCO World Heritage
Sites. = Previous issue =
The previous series of Clydesdale notes each depicted a notable person from
Scottish history: 5 pound note featuring Robert Burns on
the obverse and a vignette of a field mouse from Burns' poem To a Mouse on the
reverse 10 pound note featuring Mary Slessor on
the front and a vignette of a map of Calabar and African missionary scenes on
the back 20 pound note featuring Robert the Bruce
on the front and a vignette of the Bruce on horseback with the Monymusk Reliquary
against a background of Stirling Castle on the back
50 pound note featuring Adam Smith on the front and a vignette of industry
tools against a background of sailing ships on the back
100 pound note featuring Lord Kelvin on the front and a vignette of the
University of Glasgow on the back An image of Adam Smith also features on
the £20 note issued in 2007 by the Bank of England, granting Smith the unique
status of being the only person to feature on banknotes issued by two
different British banks, and the first Scot to appear on a Bank of England
banknote. = Older issues =
The Clydesdale Bank ceased issuing £1 notes in the late 1980s. These latterly
had an image of Robert the Bruce, whilst the contemporaneous £20 notes had an
image of Lord Kelvin. The £10 notes issued from 1971 bore an
image of Scottish explorer David Livingstone with palm tree leaves and an
illustration of African tribesmen on the back. A later issue showed Livingstone
against a background graphic of a map of his Zambezi expedition, showing the
River Zambezi, Victoria Falls, Lake Nyasa and Blantyre, Malawi; on the
reverse, the African figures were replaced with an image of Livingstone's
birthplace in Blantyre. = Commemorative banknotes =
Occasionally the Clydesdale Bank issues special commemorative banknotes to mark
particular occasions or to celebrate famous people. These notes are much
sought-after by collectors and they rarely remain long in circulation.
Examples to date have included: a £5 issued in 1996 to commemorate the
poetry of Robert Burns. On the front of the notes is an overprint of his poems
above the portrait. a £10 issued in 1997 to commemorate the
work of Mary Slessor. On the back of the note is the map of Calabar and Mary
Slessor along with a group of Africans. a £20 to the Commonwealth Heads of
Government Meeting in Edinburgh, October 1997, showing on the reverse the
Edinburgh International Conference Centre where the meeting was held, along
with Edinburgh Castle in the background and the new Clydesdale Bank building at
Tollcross, Edinburgh a £20 note to mark Glasgow's
celebrations as UK City of Architecture and Design, featuring a portrait of
Glaswegian architect Alexander "Greek" Thomson; on the reverse is an
illustration of the Lighthouse building by Charles Rennie Mackintosh and the
dome of Thomson's Holmwood House a £20 to mark the 700th anniversary of
Robert the Bruce's coronation, featuring the Coat of Arms used by the Bruce on
the front and a narrative commemorating the anniversary on the rear
a £10 note to mark the bank's sponsorship of the Scottish Commonwealth
Games team, depicting the team logo on the front, and on the rear a montage of
all the events at the games a £5 note featuring a portrait of the
Scottish civil engineer, Sir William Arrol and the image of the Forth Bridge
to mark the 125th anniversary of the construction of the bridge; this issue
is noted as it is printed on polymer rather than paper.
= Polymer banknotes = In March 2015, the Clydesdale Bank
became the first bank in Great Britain to issue polymer banknotes. The £5
commemorative notes, issued to commemorate the 125th anniversary of the
construction of the Forth Bridge, are printed by De La Rue and are the first
in Europe to use the company's "Safeguard" polymer substrate security
feature. The notes also use the "Spark Orbital" security feature which depicts
a reflective map of Scotland over a transparent "window" in the banknote.
Although the Clydesdale's 2015 issue are the first plastic banknotes issued
within Great Britain, these are not the first polymer banknotes to be issued in
the United Kingdom — in 1999, the Northern Bank issued a series of polymer
£5 notes depicting the US Space Shuttle. The Bank of England plans to use polymer
for its next issue of £5 and £10 notes in 2016.
Commonwealth Games In March 2005, Clydesdale Bank became
one of the official partners of the Scottish Commonwealth Games Team, at the
2006 Commonwealth Games in Melbourne, Australia. This sponsorship builds on
the relationship formed by its parent, NAB Group, who are one of the Games'
main sponsors as well as a key partner with the Australian team, whilst the
sister company, Bank of New Zealand, has joined forces to support its national
team. The bank also released a series of Ten Pound notes with a Commonwealth
Games related theme for the occasion. See also
Banknotes of the pound sterling References
External links Clydesdale Bank site
Clydesdale Banknotes