Midland Bank
Encyclopedia
Midland Bank Plc was one of the Big Four
banking groups in the United Kingdom
for most of the 20th century. It is now part of HSBC
. The bank was founded as the Birmingham and Midland Bank in Union Street, Birmingham
, England in August 1836. It expanded in the Midlands
, absorbing many local banks, and merged with the Central Bank of London Ltd in 1891, becoming the London City and Midland Bank. After a period of nationwide expansion, including the acquisition of many smaller banks, the name Midland Bank Ltd was adopted in 1923. By 1934 it was the largest deposit bank in the world. It was listed on the London Stock Exchange
and was once a constituent of the FTSE 100 Index
but in 1992 it was taken over by HSBC Holdings plc
.
, England, in August 1836. Geach had formerly worked at the Bank of England
; he secured the business support and capital backing of leading merchants and manufacturers in Birmingham.
In the 1830s and 1840s, Midland occupied an important niche in Birmingham business, particularly in the discounting of bills of exchange for its customers. Links with local industrial and commercial concerns were especially strong and, by the 1850s, the bank’s customers included railways, iron founders and engineering concerns, utilities and municipal corporations.
Midland acquired Stourbridge
Old Bank in 1851 and Nichols, Baker and Crane of Bewdley in 1862. Both firms had been pioneers of banking in the West Midlands
: the origins of the Stourbridge bank can be traced back to 1762 and the Bewdley
bank dated from 1777.
From the 1880s, it expanded its customer base by opening new branches and acquiring other banks. In 1891 it acquired the Central Bank of London (which gave Midland a seat in the London Clearing House) and, in 1898, it bought the City Bank (which provided a London
head office).
By 1918, with deposits of £335 million, it ranked as the largest bank in the world. Edward Hopkinson Holden led the bank at this time first as Managing Director from 1898 to 1908 and then as Chairman and Managing Director from 1908 until his death in 1919. He oversaw more than 20 bank amalgamations between 1891 and 1918, and opened new branches throughout England and Wales
.
Holden also expanded overseas; it was the first British
bank to set up a foreign exchange
department and, by 1919, it was acting as London bank to some 650 correspondent banks throughout the world. From 1907, these correspondents included The Hongkong and Shanghai Banking Corporation.
After the First World War
, the leading British banks entered an agreement with the government that they would not attempt further amalgamations without Treasury approval. As a result, Midland turned its attention to expanding its branch network, adding new banking services, mechanising its systems (from 1928) and advertising its activities.
In 1958 it acquired Forward Trust, which became a leader in instalment finance, leasing and factoring services.
In 1967 Midland acquired a share in Montagu Trust, the owner of Samuel Montagu & Co. Limited, and thereby became the first British clearing bank to own a London merchant bank
. Samuel Montagu, with its own history dating back to 1853, became a wholly owned subsidiary in 1974 and is now part of HSBC
's private banking business. Through the acquisition of Samuel Montagu & Co, Midland also gained a majority share in Guyerzeller Bank AG (now HSBC Guyerzeller Bank
) in Switzerland.
Further diversification followed in 1972, when Midland was the leading member of the consortium that acquired the Thomas Cook
travel business. After becoming sole owner in 1977, Midland sold its interest in 1992.
In 1974 Midland started to open branches or representative offices in overseas countries and to acquire other international banks. The largest of these was the purchase of a majority share in Crocker National
of California
, USA: this was not a success and Midland was forced to take full ownership in 1985 so that it could sell it to Wells Fargo
the following year.
In 1980 Midland acquired a controlling interest in Trinkaus & Burkhardt KGaA, a private bank in Germany
with a long history of its own. Today, as HSBC Trinkaus, the company enjoys a leading position in both commercial and investment banking.
The Hongkong and Shanghai Banking Corporation acquired a 14.9% equity interest in Midland Bank in 1987, and a strong working relationship developed. In 1989 First Direct
was established and was at the forefront of telephone banking
, with person-to-person service available 24 hours a day, 365 days a year.
In 1992, HSBC Holdings plc acquired full ownership of Midland Bank. At the time it was one of the largest acquisitions in banking history, and gave HSBC, which had to move its Hong Kong
-based headquarters to London in anticipation of the July 1, 1997 transfer of Hong Kong to the People's Republic of China, accepting primary banking supervision by the Bank of England and a major foothold in Europe
that it needed to complement its existing business in Asia
and the Americas
. Midland Bank was renamed HSBC Bank
in 1999 as part of the adoption of the HSBC brand throughout the Group. The former head office of the London, City and Midland Bank (later one of the major City branches of Midland Bank), at 5 Threadneedle Street, is now a bar, with its magnificent banking hall as a rather muted centrepiece.
The last head office of the Midland Bank, opposite the Bank of England in Poultry and Princes Street, was sold in 2006 to a Russian tycoon, with HSBC vacating the banking hall on the ground floor and huge underground deposit vaults in 2007. The architect John Alfred Gotch
designed the building. with assistance from Edwin Landseer Lutyens
. Built between 1921 and 1939, and symbol of the 1930s pride of the biggest bank in the world, the building eventually became a hotel.
logo, surrounded by golden coins originally on a black, then later blue background, and for its slogan "the listening bank", written by the advertising executive Rod Allen
. Advertisements for the bank appeared in the popular Theme Park
computer game. The Midland Bank still traded as Midland Bank but using the HSBC logo and was finally rebranded as HSBC Bank
in 1999 as part of the adoption of the HSBC brand throughout the group. However, a dormant subsidiary, Midland Bank (Branch Nominees) Limited, continues to be registered at Companies House
.
Big Four (banks)
Big Four is the colloquial name for the four main banks in several countries, where the banking industry is dominated by just four institutions and where the phrase has gained currency.-Australia:...
banking groups in the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
for most of the 20th century. It is now part of HSBC
HSBC
HSBC Holdings plc is a global banking and financial services company headquartered in Canary Wharf, London, United Kingdom. it is the world's second-largest banking and financial services group and second-largest public company according to a composite measure by Forbes magazine...
. The bank was founded as the Birmingham and Midland Bank in Union Street, Birmingham
Birmingham
Birmingham is a city and metropolitan borough in the West Midlands of England. It is the most populous British city outside the capital London, with a population of 1,036,900 , and lies at the heart of the West Midlands conurbation, the second most populous urban area in the United Kingdom with a...
, England in August 1836. It expanded in the Midlands
English Midlands
The Midlands, or the English Midlands, is the traditional name for the area comprising central England that broadly corresponds to the early medieval Kingdom of Mercia. It borders Southern England, Northern England, East Anglia and Wales. Its largest city is Birmingham, and it was an important...
, absorbing many local banks, and merged with the Central Bank of London Ltd in 1891, becoming the London City and Midland Bank. After a period of nationwide expansion, including the acquisition of many smaller banks, the name Midland Bank Ltd was adopted in 1923. By 1934 it was the largest deposit bank in the world. It was listed on the London Stock Exchange
London Stock Exchange
The London Stock Exchange is a stock exchange located in the City of London within the United Kingdom. , the Exchange had a market capitalisation of US$3.7495 trillion, making it the fourth-largest stock exchange in the world by this measurement...
and was once a constituent of the FTSE 100 Index
FTSE 100 Index
The FTSE 100 Index, also called FTSE 100, FTSE, or, informally, the footsie , is a share index of the 100 most highly capitalised UK companies listed on the London Stock Exchange....
but in 1992 it was taken over by HSBC Holdings plc
HSBC
HSBC Holdings plc is a global banking and financial services company headquartered in Canary Wharf, London, United Kingdom. it is the world's second-largest banking and financial services group and second-largest public company according to a composite measure by Forbes magazine...
.
Early history
Midland Bank was founded by Charles Geach, its first manager in Union Street, BirminghamBirmingham
Birmingham is a city and metropolitan borough in the West Midlands of England. It is the most populous British city outside the capital London, with a population of 1,036,900 , and lies at the heart of the West Midlands conurbation, the second most populous urban area in the United Kingdom with a...
, England, in August 1836. Geach had formerly worked at the Bank of England
Bank of England
The Bank of England is the central bank of the United Kingdom and the model on which most modern central banks have been based. Established in 1694, it is the second oldest central bank in the world...
; he secured the business support and capital backing of leading merchants and manufacturers in Birmingham.
In the 1830s and 1840s, Midland occupied an important niche in Birmingham business, particularly in the discounting of bills of exchange for its customers. Links with local industrial and commercial concerns were especially strong and, by the 1850s, the bank’s customers included railways, iron founders and engineering concerns, utilities and municipal corporations.
Midland acquired Stourbridge
Stourbridge
Stourbridge is a town within the Metropolitan Borough of Dudley, in the West Midlands of England. Historically part of Worcestershire, Stourbridge was a centre of glass making, and today includes the suburbs of Amblecote, Lye, Norton, Oldswinford, Pedmore, Wollaston, Wollescote and Wordsley The...
Old Bank in 1851 and Nichols, Baker and Crane of Bewdley in 1862. Both firms had been pioneers of banking in the West Midlands
West Midlands (region)
The West Midlands is an official region of England, covering the western half of the area traditionally known as the Midlands. It contains the second most populous British city, Birmingham, and the larger West Midlands conurbation, which includes the city of Wolverhampton and large towns of Dudley,...
: the origins of the Stourbridge bank can be traced back to 1762 and the Bewdley
Bewdley
Bewdley is a town and civil parish in the Wyre Forest District of Worcestershire, England, along the Severn Valley a few miles to the west of Kidderminster...
bank dated from 1777.
Acquisitions and development in its first 50 years
London
London is the capital city of :England and the :United Kingdom, the largest metropolitan area in the United Kingdom, and the largest urban zone in the European Union by most measures. Located on the River Thames, London has been a major settlement for two millennia, its history going back to its...
head office).
By 1918, with deposits of £335 million, it ranked as the largest bank in the world. Edward Hopkinson Holden led the bank at this time first as Managing Director from 1898 to 1908 and then as Chairman and Managing Director from 1908 until his death in 1919. He oversaw more than 20 bank amalgamations between 1891 and 1918, and opened new branches throughout England and Wales
Wales
Wales is a country that is part of the United Kingdom and the island of Great Britain, bordered by England to its east and the Atlantic Ocean and Irish Sea to its west. It has a population of three million, and a total area of 20,779 km²...
.
Holden also expanded overseas; it was the first British
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
bank to set up a foreign exchange
Foreign exchange market
The foreign exchange market is a global, worldwide decentralized financial market for trading currencies. Financial centers around the world function as anchors of trading between a wide range of different types of buyers and sellers around the clock, with the exception of weekends...
department and, by 1919, it was acting as London bank to some 650 correspondent banks throughout the world. From 1907, these correspondents included The Hongkong and Shanghai Banking Corporation.
After the First World War
World War I
World War I , which was predominantly called the World War or the Great War from its occurrence until 1939, and the First World War or World War I thereafter, was a major war centred in Europe that began on 28 July 1914 and lasted until 11 November 1918...
, the leading British banks entered an agreement with the government that they would not attempt further amalgamations without Treasury approval. As a result, Midland turned its attention to expanding its branch network, adding new banking services, mechanising its systems (from 1928) and advertising its activities.
Post-war recovery and international alliances
Midland responded to the ending of credit restrictions in 1958 by extending its branch network and by introducing a series of innovative services, including personal loans (1958), personal cheque accounts (1958) and cheque cards (1966).In 1958 it acquired Forward Trust, which became a leader in instalment finance, leasing and factoring services.
In 1967 Midland acquired a share in Montagu Trust, the owner of Samuel Montagu & Co. Limited, and thereby became the first British clearing bank to own a London merchant bank
Merchant bank
A merchant bank is a financial institution which provides capital to companies in the form of share ownership instead of loans. A merchant bank also provides advisory on corporate matters to the firms they lend to....
. Samuel Montagu, with its own history dating back to 1853, became a wholly owned subsidiary in 1974 and is now part of HSBC
HSBC
HSBC Holdings plc is a global banking and financial services company headquartered in Canary Wharf, London, United Kingdom. it is the world's second-largest banking and financial services group and second-largest public company according to a composite measure by Forbes magazine...
's private banking business. Through the acquisition of Samuel Montagu & Co, Midland also gained a majority share in Guyerzeller Bank AG (now HSBC Guyerzeller Bank
HSBC Guyerzeller Bank
HSBC Guyerzeller Bank AG, a member of the HSBC Group, was a Swiss private bank advising individuals and families in all matters of wealth management, investment advice and trust services. Its head office was in Zurich, and it had two branches in Geneva, as well as representative offices in Hong...
) in Switzerland.
Further diversification followed in 1972, when Midland was the leading member of the consortium that acquired the Thomas Cook
Thomas Cook
Thomas Cook of Melbourne, Derbyshire, England founded the travel agency that is now Thomas Cook Group.- Early days :...
travel business. After becoming sole owner in 1977, Midland sold its interest in 1992.
In 1974 Midland started to open branches or representative offices in overseas countries and to acquire other international banks. The largest of these was the purchase of a majority share in Crocker National
Crocker National Bank
Crocker National Bank was a United States bank headquartered in San Francisco, California. It was acquired by and merged into Wells Fargo Bank in 1986.-History:The bank traces its history to the Woolworth National Bank in San Francisco...
of California
California
California is a state located on the West Coast of the United States. It is by far the most populous U.S. state, and the third-largest by land area...
, USA: this was not a success and Midland was forced to take full ownership in 1985 so that it could sell it to Wells Fargo
Wells Fargo
Wells Fargo & Company is an American multinational diversified financial services company with operations around the world. Wells Fargo is the fourth largest bank in the U.S. by assets and the largest bank by market capitalization. Wells Fargo is the second largest bank in deposits, home...
the following year.
In 1980 Midland acquired a controlling interest in Trinkaus & Burkhardt KGaA, a private bank in Germany
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
with a long history of its own. Today, as HSBC Trinkaus, the company enjoys a leading position in both commercial and investment banking.
Midland joins the HSBC Group
First Direct
First Direct is a telephone and internet-based retail bank in the United Kingdom, a division of HSBC Bank plc. First Direct has headquarters in Leeds, West Yorkshire, England, and has 1.16 million customers....
was established and was at the forefront of telephone banking
Telephone banking
Telephone banking is a service provided by a financial institution, which allows its customers to perform transactions over the telephone.Most telephone banking services use an automated phone answering system with phone keypad response or voice recognition capability...
, with person-to-person service available 24 hours a day, 365 days a year.
In 1992, HSBC Holdings plc acquired full ownership of Midland Bank. At the time it was one of the largest acquisitions in banking history, and gave HSBC, which had to move its Hong Kong
Hong Kong
Hong Kong is one of two Special Administrative Regions of the People's Republic of China , the other being Macau. A city-state situated on China's south coast and enclosed by the Pearl River Delta and South China Sea, it is renowned for its expansive skyline and deep natural harbour...
-based headquarters to London in anticipation of the July 1, 1997 transfer of Hong Kong to the People's Republic of China, accepting primary banking supervision by the Bank of England and a major foothold in Europe
Europe
Europe is, by convention, one of the world's seven continents. Comprising the westernmost peninsula of Eurasia, Europe is generally 'divided' from Asia to its east by the watershed divides of the Ural and Caucasus Mountains, the Ural River, the Caspian and Black Seas, and the waterways connecting...
that it needed to complement its existing business in Asia
Asia
Asia is the world's largest and most populous continent, located primarily in the eastern and northern hemispheres. It covers 8.7% of the Earth's total surface area and with approximately 3.879 billion people, it hosts 60% of the world's current human population...
and the Americas
Americas
The Americas, or America , are lands in the Western hemisphere, also known as the New World. In English, the plural form the Americas is often used to refer to the landmasses of North America and South America with their associated islands and regions, while the singular form America is primarily...
. Midland Bank was renamed HSBC Bank
HSBC Bank (Europe)
HSBC Bank plc is one of the four major clearing banks in the United Kingdom and is a wholly owned subsidiary of HSBC Holdings. The business ranges from the traditional High Street roles of personal finance and commercial banking, to private banking, consumer finance as well as corporate and...
in 1999 as part of the adoption of the HSBC brand throughout the Group. The former head office of the London, City and Midland Bank (later one of the major City branches of Midland Bank), at 5 Threadneedle Street, is now a bar, with its magnificent banking hall as a rather muted centrepiece.
The last head office of the Midland Bank, opposite the Bank of England in Poultry and Princes Street, was sold in 2006 to a Russian tycoon, with HSBC vacating the banking hall on the ground floor and huge underground deposit vaults in 2007. The architect John Alfred Gotch
John Alfred Gotch
John Alfred Gotch was a noted British architect and architectural historian. His brother was the Pre-Raphaelite painter and illustrator Thomas Cooper Gotch, who painted his portrait....
designed the building. with assistance from Edwin Landseer Lutyens
Edwin Lutyens
Sir Edwin Landseer Lutyens, OM, KCIE, PRA, FRIBA was a British architect who is known for imaginatively adapting traditional architectural styles to the requirements of his era...
. Built between 1921 and 1939, and symbol of the 1930s pride of the biggest bank in the world, the building eventually became a hotel.
Branding
The Midland Bank was famous for its golden griffinGriffin
The griffin, griffon, or gryphon is a legendary creature with the body of a lion and the head and wings of an eagle...
logo, surrounded by golden coins originally on a black, then later blue background, and for its slogan "the listening bank", written by the advertising executive Rod Allen
Rod Allen (advertising executive)
Roderick Howard Allen was a British advertising executive who wrote many well known advertising slogans and jingles used in the United Kingdom. He was nicknamed the "jingle king"....
. Advertisements for the bank appeared in the popular Theme Park
Theme Park (computer game)
Theme Park is a construction and management simulation game designed by Bullfrog Productions and originally released in 1994, in which the player designs and operates an amusement park....
computer game. The Midland Bank still traded as Midland Bank but using the HSBC logo and was finally rebranded as HSBC Bank
HSBC Bank (Europe)
HSBC Bank plc is one of the four major clearing banks in the United Kingdom and is a wholly owned subsidiary of HSBC Holdings. The business ranges from the traditional High Street roles of personal finance and commercial banking, to private banking, consumer finance as well as corporate and...
in 1999 as part of the adoption of the HSBC brand throughout the group. However, a dormant subsidiary, Midland Bank (Branch Nominees) Limited, continues to be registered at Companies House
Companies House
Companies House is the United Kingdom Registrar of Companies and is an Executive Agency of the United Kingdom Government Department for Business, Innovation and Skills . All forms of companies are incorporated and registered with Companies House and file specific details as required by the...
.