Montrose Banking Company

Collection includes:

Minutes, 1814-1822: including balance sheets, 1816-1822.

Financial Records, 1814-1828: stock ledger, record of banknotes issued.

Letter book, 1814-1816: with separate index.

The Montrose Banking Company, also known as the Montrose Bank, was established in 1814. The first meeting of the promoters (chiefly local merchants) was held in January. Those in attendance included James Ford, merchant, of Finhaven, Montrose merchants Patrick Robertson, David Kinnear, David White, William Gordon, John Aberdein, James Clark, John Paton, Alexander Smart, William Smart, John Myers, Robert Smith, Thomas Whyte and writer James Leighton. They proposed to establish a bank with a capital of £100,000 divided into 250 shares of £400 each, with no partner holding more than eight shares.

A General Meeting was held in February at which the first directors were appointed: Alexander Airth; George Paton; David Kinnear; Alexander Smart; John Aberdein; Patrick Robertson and David White. They were charged with making the practical arrangements required to launch the bank. These seven individuals continued to be re-elected at every annual meeting until at least 1822.

James Austin, the Accountant of the Perth Union Bank was recruited as the first Cashier of the Montrose Bank on a salary of £250 and David Hill of the British Linen Company's Montrose branch became the first Accountant on a salary of £150.

When the Montrose Bank started business in May 1814, there were 82 partners. Of these, 31 were merchants, 26 farmers and 12 members of professions. Branches were opened in Arbroath and Brechin by 1816 and bankers Thomas Kinnear & Son became the Montrose Bank's Edinburgh agents.

The main customers of the Bank tended to be tenant farmers and those involved in local trades such as rope and sail making, shipbuilding and brewing. The New Whale Fishing Company received a loan of £1,000 in 1820.

Like many other banks, the Montrose Bank seems to have suffered as a result of the financial and economic crisis that hit Britain in 1816 and 1826. The salaries of the Accountant and Cashier were each reduced by £50 following the General Meeting of 1816. Over the course of 1826, the Montrose Bank borrowed £10,000 (around half a million today) from the Bank of Scotland, indicating that they had sustained substantial losses.

In July 1828, the partners of the Montrose Bank approached the National Bank of Scotland (which later became part of the Royal Bank of Scotland) with a proposal that it take over its business. The National Bank's board agreed. The business was officially handed over on 31 December that year. It is not known what happened to the branches at Brechin and Arbroath. It appears however that the winding up of the Bank's affairs took many years. There is a note pasted to the front of the only surviving banknote ledger which reads:

"In the month of April 1842 an agreement was entered into between the Montrose Bank and the Dundee Union Bank by which the latter, for the sum of £200 agreed to pay all the outstanding notes and receipts belonging to the former when they shall be presented.

This agreement was Registered in the Sheriff Court Books at Forfar and an Extract thereof is put up into the west lower division of the Montrose Bank's safe here can be referred to in the event of any future claim being made on me for any of the notes or receipts outstanding. David Hill, Montrose 4th February 1861."

John Barclay, one of the directors of the Montrose Bank by 1828, went on to become Agent of the Bank of Scotland's Montrose branch when it opened in 1835.

The collection is arranged into the following series:

• MON/1: Minutes
• MON/2: Financial Records
• MON/3: Letter Books

Access is by appointment only, and at the discretion of the Archivist. Closure periods apply to some records less than 100 years old. Please e-mail archives@lloydsbanking.com for further information.

An item level catalogue is available - please e-mail archives@lloydsbanking.com for further details.

Please note that this catalogue replaces the NRAS survey of the Montrose Banking Company records undertaken in the 1970s (NRAS945).

Copying of material is permitted at the discretion of Lloyds Banking Group Archives.

It is not known how these records ended up in the custody of Bank of Scotland, as the Montrose Bank was acquired by the National Bank of Scotland, which went on to merge with the Royal Bank of Scotland. It may be that they were transmitted via the Bank of Scotland's Montrose Agent, John Barclay, who was a former director of the Montrose Bank.

Information about the circumstances of the winding up of the Montrose Bank can be found in the minutes of the National Bank of Scotland (held by the Royal Bank of Scotland archives: http://heritagearchives.rbs.com/wiki/Welcome_to_RBS_Heritage_Online).

Charles W. Munn, The Scottish Provincial Banking Companies, 1747-1864, (Edinburgh, 1981)