Paper money of England and Wales

Edited by Catherine Eagleton and Artemis Manolopoulou

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An introduction to English banking history

Page two

Provincial private banks

The spread of private banks into provincial towns generally came later than the London experience. Prior to 1750 there were only a handful of provincial private banks, as shown in Table one.

Year Town Name Modern link
1650s Nottingham Thomas Smith Royal Bank of Scotland
c.1685 Derby Crompton, Newton & Co. Royal Bank of Scotland
1716 Gloucester James Wood Lloyds
1737 Stafford John Stevenson Lloyds
c.1743 Dover Fector & Minet Royal Bank of Scotland

Table two: Early provincial banks


This table tells a quite remarkable story, in that none of these five early banks failed. They all subsequently became part of the joint stock movement in the latter half of the 19th century and thereby established themselves within the modern banking institutions of today.

After 1750 the growth in provincial private banks was quite substantial, with 230 provincial banks operating in 1797, a number that had increased to 721 by 1810. By the1820s, every town of substance had its own local bank with its own local banknote issues. With this expansion in the number of provincial private banks came an increase in the number of banking failures.

The £1 note of the Bristol Bullion Bank of Browne, Cavenagh, Browne & Bailey, issued in 1824, is a typical banknote issue of the period. This bank failed in 1825 and the holder of this note would have lost most of their money, although the hand stamps on this note indicate that two ‘dividends’ were paid, so some money was recovered. For a local bank to fail was an absolute calamity for all concerned and many people suffered financial ruin as a consequence. Private banks were restricted to just six partners and they often did not have the resources to survive a financial crisis. The solution was to enable the banks to increase their size and resources by allowing the creation of joint stock banks.

Joint stock banks

In 1826 new legislation allowed the creation of joint stock banks, which meant that people could combine as shareholders (then called proprietors) to establish larger banks. The illustration here (thumbnail + link: 1980,1130.258) shows the 1830s issue of the £5 note from the Norfolk & Norwich Joint Stock Banking Company. This bank eventually became a part of Barclays Bank; all its banknote issues would have been honoured and fully paid upon demand.  

Table two gives a list by date of the first joint stock banks to be established, (excepting the Bank of England).

Year Bank Modern link
1826 Stuckey’s Bank, Somerset NatWest
1826 Lancaster Banking Co. NatWest
1826 Norfolk & Norwich Banking Co. Barclays
1827 Huddersfield Banking Co. HSBC
1827 Bradford Banking Co. HSBC
1829 Cumberland Union Banking Co. HSBC

Table two: The first joint stock banks