| Former type | Joint-stock |
|---|---|
| Industry | Banking |
| Fate | Merger with Westminster Bank |
| Successor | National Westminster Bank |
| Founded | 1833 |
| Defunct | 1970 |
| Headquarters | 15 Bishopsgate, London EC2 |
| Subsidiaries | District Bank |
National Provincial Bank was a British retail bank which operated in England and Wales from 1833 until its merger into the National Westminster Bank in 1970; it remains a registered company but is dormant.[1] Considered one of the Big Five, it expanded during the 19th and 20th centuries and took over a number of smaller banking companies.
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The National Provincial Bank was organised as a joint-stock company by Thomas Joplin in 1833. At the time, the Bank of England had exclusive statutory power to issue banknotes within a 65-mile (105 km) radius of London. Although the bank's administrative offices were in London, it decided to open its branches outside the 65 mile radius so that the bank could issue its own notes. From the beginning National Provincial lived up to its name, serving provincial customers throughout England. The bank was without a national competitor for about 60 years. By 1836 it had over 20 branches across England and Wales.[2]
The first branch of the bank was opened on 1 January 1834 in Gloucester. Like the District Bank, the company planned to establish new branches and acquire smaller banks, and by 1835 it had opened 20 new offices. The bank's expansion continued throughout the 19th century with new branch openings and by taking over smaller local banking companies:
| Date | Acquisition | Established |
|---|---|---|
| 1834 | Rotton & Co., Birmingham | 1806 |
| 1835 | Bloxsome & Player, Durham | 1813 |
| 1835 | Bristol City Bank | branch of Northern & Central Bank |
| 1836 | Vye & Harris, Ilfracombe | 1807 |
| 1836 | William Skinner & Co., Stockton | 1815 |
| 1836 | Pyke, Law & Co., Barnstaple | 1807 |
| 1838 | Lichfield, Rugeley & Tamworth Banking Co. | 1836 |
| 1839 | Husband & Co., Devonport | 1810 |
| 1840 | Fryer, Andrews & Co., Wimborne | c.1790 |
| 1840 | Harris & Co., Dartmouth | 1806 |
| 1840 | Hulke & Son, Deal | 1808 |
| 1841 | Minet & Fector, Dover | 1700 |
| 1842 | Cole, Holroyd & Co., Exeter | 1822 |
| 1843 | Peter Pew & Co., Sherbourne | c.1750 |
| 1843 | Loveband & Co., Torrington | 1808 |
| 1843 | Ley & Co., Bideford | c.1790 |
| 1844 | Isle of Wight Joint-Stock Bank, Newport, Isle of Wight | 1842 |
| 1855 | Thomas Kinnersly & Sons, Newcastle-under-Lyme | c.1780 |
| 1846 | Stockton & Durham County Bank, Stockton | 1838 |
| 1858 | William Moore, Stone | 1800 |
| 1868 | Crawshay, Bailey & Co., Abergavenny | 1837 |
| 1868 | Bailey & Co., Newport | 1837 |
By the mid-1860s, National Provincial had acquired more than a dozen small banks and had established 122 branches and sub-branches throughout England and Wales. It finally opened a London banking office in 1866, recognising that a presence in the world's financial capital was worth the sacrifice of its note-issuing privilege. In 1866 the bank opened a lavish head office at 15 Bishopsgate in the City of London, designed by John Gibson. Expansion continued, and now that the National Provincial Bank of England was established in the capital it began to take over a number of London-based banking companies, as well as further acquisitions in the English provinces, namely:
| Date | Acquisition | Established |
|---|---|---|
| 1871 | David Morris & Sons, Carmarthen | c.1790 |
| 1878 | Bank of Leeds | 1864 |
| 1899 | County of Stafford Bank | 1836 |
| 1903 | Knaresborough & Claro Banking Co. | 1831 |
| 1918 | William & John Biggerstaffe, London | c.1830s |
| 1919 | Sheffield Banking Co. | 1831 |
| 1919 | Bradford District Bank | 1862 |
| 1920 | Northamptonshire Union Bank | 1836 |
| 1920 | Richards & Co., Llangollen | 1854 |
| 1920 | Shilson, Coode & Co., St Austell | 1793 |
| 1922 | Dingley & Co., Launceston | 1855 |
| 1922 | Dingley, Pearse & Co., Okehampton | 1856 |
| 1924 | Guernsey Banking Co. Ltd. | 1847 |
1911 saw the formation of Lloyds Bank (France) when Lloyds Bank acquired Armstrong and Co., based in Paris and Le Havre. From 1917 it was run jointly as Lloyds and National Provincial Bank. In 1955, Lloyds Bank bought full ownership and it became Lloyds Bank (Foreign) and later Lloyds Bank Europe.[4]
The bank continued to grow rapidly. At the turn of the 20th century, the company had about 250 offices in England and Wales and approximately £3 million in capital. After World War I, the company began an accelerated acquisition and merger strategy. The most important of its mergers during this time was with the Union of London and Smith's Bank, itself the product of the amalgamation of two of the most venerable banking institutions in England, which added 230 branches to National Provincial's growing financial network. Prescott's Bank was established in 1766 as Prescott, Grote, Culverden and Hollingsworth at Threadneedle Street, but Prescott's own oldest constituent dates to 1750 via the merger in 1891 with Miles, Cave, Baillie & Co.[5] In 1903 it merged with the Union of London and Smith's Bank which had been formed in 1902 from the merger of the Union Bank of London, established at Moorgate in 1839 and Smith, Payne and Smiths, established in 1758.[6] After the 1918 merger, the bank traded for a few years as the National Provincial and Union Bank of England. In 1923, the bank acquired Grindlay and Co. and converted it to a limited liability company which would operate separately.
At this time, the bank was involved in a notable court case. In England and those common law jurisdictions whose approach follows that of English law in treating the duty of confidentiality as resting in contract, the classic authority is the Court of Appeal decision in Tournier v National Provincial and Union Bank of England [1924] 1KB 461.[7] The duty extends at least to information concerning account transactions and extends beyond the date of the termination of the banker customer contract. Information attained from other sources, such as a credit reference agency, is also covered.[8] The duty is not absolute for the bank may disclose information where the disclosure is under compulsion by law, where there is a duty to the public to disclose, where the interests of the bank require disclosure and where the disclosure is made by the express or implied consent of the customer.[9]
In 1924, the bank shortened its name to National Provincial Bank Limited.[10] By 1928, its balance sheet totalled almost £3 million. When National Provincial decided to exit overseas banking in 1948, it disposed of Grindlays Bank to the National Bank of India, headquartered in London, in return for shares and a cash payment.[11] In 1968, the short-lived National Provincial and Rothschild Bank was jointly formed with N. M. Rothschild & Sons.[12]
Although National Provincial's growth had been interrupted by World War I, the bank vigorously renewed its acquisition programme after the war. Coutts & Co. private bankers, acquired in 1920,[13] and North Central Wagon and Finance Co., acquired in 1958,[14] were some of the significant purchases made by National Provincial. In 1961 National Provincial acquired the Isle of Man Bank, enabling it to enter merchant and offshore banking[15] and in 1962, District Bank was bought to create a company with over £1.4 billion in assets and 2,100 branches, although the two banks maintained their separate identities and independent operations.[16] The bank later introduced the personal loan and, in 1965, issued the precursor of the cheque guarantee card. In the same year a merchant banking subsidiary, County Bank, was also formed.
The merger of National Provincial and Westminster Bank,[17] announced in early 1968, shocked the British public and banking community. Although the Bank of England had indicated a willingness to allow mergers as part of a rationalisation process, no one had seriously believed it would permit mergers among the largest and most influential banks.
The District Bank, National Provincial, and Westminster Bank were fully integrated in the new firm's structure, while Coutts & Co., Ulster Bank (a 1917 Westminster acquisition), and the Isle of Man Bank continued as separate operations. Duncan Stirling, chairman of Westminster Bank, became first chairman of the fifth largest bank in the world. In 1969 David Robarts, former chairman of National Provincial, assumed Stirling's position. The statutory process of integration was completed in 1969 and the new company, National Westminster Bank Limited, opened its doors for business on 1 January 1970.[18] NatWest, as it became known, is now part of The Royal Bank of Scotland Group.
Until the early 20th century, commercial banks in England and Wales were permitted to print their own money, subject to a number of limitations. The Country Bankers’ Act 1826 restricted the issue of banknotes by commercial banks in England and Wales, so that only provincial banks over 65 miles away from London were permitted to print their own money. As the National Provincial Bank was based outside London, it was free to issue its own banknotes. In 1866, when it opened its London headquarters, National Provincial was obliged to give up its note-issuing right and deal only in Bank of England notes.
The Bank Charter Act 1844 began the process which gave the Bank of England exclusive note-issuing powers. Under the Act, no new banks could start issuing notes, and note-issuing banks were barred form expanding their note issue. Gradually, these banks vanished through mergers and closures and their note-issuing powers went with them. The last private English banknotes were issued in 1921 by Fox, Fowler and Company, a Somerset bank. Today, the Bank of England has a monopoly of banknote issue in England and Wales.[19]