First National Bank (South Africa)

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First National Bank's logo

First National Bank (FNB) is one of South Africa's "big four" banks.

[edit] History

FNB claims to be South Africa's oldest bank and officially traces its origins back to the Eastern Province Bank, which was formed in Grahamstown in 1838, due to wool export boom in the district. By 1874, the bank had four 4 branches - at Grahamstown, Middelburg, Cradock and Queenstown.

Due to a recession the bank was bought out in 1874 by the Oriental Bank Corporation (OBC). However, As a result of financial difficulties that the Oriental Bank Corporation was experiencing in India, it decided to withdraw from South Africa and thus the Bank of Africa was formed in 1879 to take over the OBC's business in South Africa.

During the same period the government of the South African Republic desired to create a local commercial bank, due to the discovery of gold in Barberton and the Witwatersrand. The government thus created a bank through a concession agreement. The task of the bank was to focus primarily one financial agricultural development, but a state mint was also established as part of the concession. The Nationale Bank der Zuid-Afrikaansche Republiek Beperk (National Bank of the South African Republic Limited) was registered in Pretoria in 1891 and opened its doors for business on 5 April of the same year. After the conclusion of the Second Anglo-Boer War in 1902, the name of this bank was changed to the National Bank of South Africa Limited.

Due to another recession, the Bank of Africa the was bought out by the National Bank in 1912, Another bank, the National Bank of the Orange River Colony had already been bought out in 1910. The Natal Bank, which was founded in 1854 to fund the Natal Colony's sugar industry, also suffered financial difficulties and was taken over in 1914. The National Bank was now one of the strongest banks in South Africa.

However, by the early 1920s, the National Bank was suffering from bad debt and heavy losses. It consequently merged with the Anglo-Egyptian Bank and the Colonial Bank in 1925 to form Barclays Bank (Dominion, Colonial and Overseas). In 1971 Barclays restructured its operation and its South Africa operation was renamed Barclays National Bank Limited.

However, due to a disinvestment campaign against South Africa because of its apartheid policies, Barclays was forced to reduce its shareholding and sold its remaining shareholding in the bank in 1986. The bank was renamed "First National Bank of Southern Africa Limited" in 1987 and became a wholly South African owned and controlled entity.

In 1998 the financial services interests (which included their shareholding in First National Bank) of Rand Merchant Bank Holdings and Anglo-American Corporation were merged to form FirstRand Limited, which is listed on the Johannesburg Stock Exchange. In consequence, FNB became a wholly owned subsidiary of FirstRand Limited; it currently trades as a division of FirstRand Bank Limited. FNB also has subsidiaries in Swaziland, Botswana and Namibia, which are all listed on their country's respective stock exchanges.