The North and South Wales Bank

The North and South Wales Bank, also known as the Wales Bank, was a nineteenth-century British bank created to serve the commercial, industrial, agricultural and mining communities of Wales and the neighbouring counties of England. It was formed in Liverpool in 1836, at a time when the strong commercial relationship between Liverpool and Wales created demand for a bank that could connect Welsh businesses with the financial resources and trading infrastructure of the port city. Its first premises were in James Street, Liverpool. The bank’s promoters identified a gap in local banking provision. Its prospectus emphasized that owners of collieries, mines, smelting works and other enterprises were often obliged to conduct their banking outside their districts or manage banking matters themselves. The proposed institution therefore aimed to create a broad branch network reaching Welsh towns despite difficult transport and communication conditions. Wales had no railway network at the time, so the bank’s organizers used travelling deputations to investigate local opportunities, negotiate with existing private banks and identify suitable locations for new offices. The bank began operations by acquiring a number of private banking businesses and opening branches and sub-branches. During its first year it established a substantial presence in North Wales and the border counties, with offices including Bishop’s Castle, Newtown, Welshpool, Llanfyllin, Oswestry, Ruthin, Llanrwst, Caernarfon, Chester, Mold and Wrexham. It also benefited from the collapse of the Northern & Central Bank of England, taking over eight of that bank’s branches in North Wales. The institution later expanded into South Wales and developed a significant network in Merseyside, where its urban branches served industrial, shipping and trading customers. By November 1908 it had 84 branches and 24 sub-branches. The bank’s business combined agricultural and rural banking in Wales, Cheshire and Shropshire with commercial banking in Liverpool and the wider Merseyside region. Its Liverpool base remained important throughout its independent existence, moving from James Street to 62 Castle Street in 1873. In 1901 the bank acquired Leyland and Bullins, a Liverpool banking firm with strong connections to the shipping and cotton trades, strengthening its position in the city. The institution developed a reputation for careful bookkeeping, staff training and operational efficiency. George Rae was associated with a management approach that placed unusual emphasis on the selection and education of employees. The bank also had a notable number of Welsh-speaking managers and clerks, an important feature for a bank operating across Welsh communities. Bankers associated with the institution included George Rae, R. Meredith Jones and Rowland Hughes. After a period of profitability in the late nineteenth century, the bank’s position weakened as economic conditions changed. The cyclical downturn in the cotton industry and the financial disturbances associated with the Panic of 1907 contributed to the decision to seek a merger. In November 1908 the North and South Wales Bank was absorbed by Midland Bank under the leadership of Sir Edward Holden. Its branches and staff became part of Midland’s larger network, ending the bank’s existence as an independent institution. The takeover also ended its right to issue banknotes. Its withdrawal of Welsh banknotes in 1908 marked the disappearance of the last Welsh banknote-issuing bank, leaving Wales dependent on Bank of England notes.

The North and South Wales Bank was established in Liverpool in 1836 as a regional institution intended to serve Wales and nearby English counties. Its creation reflected the close commercial ties between Liverpool and Wales and the limited banking facilities available to many Welsh mining, manufacturing, agricultural and trading districts. The bank’s prospectus proposed a share issue and argued that industrial proprietors were frequently forced to bank outside their local areas or undertake banking themselves. The organizers planned a bank with branches throughout Wales. This was an ambitious objective because transport and communications were difficult and Wales had no railway system at the time. A provisional committee of Liverpool merchants, manufacturers and businessmen dispatched representatives to Welsh towns and to London. These deputations were authorized to negotiate the purchase of existing banking businesses, recruit staff and determine where new branches should be opened. Sir Love Parry Price Parry, Ambrose Lace and John Dean Case were appointed as the bank’s first trustees. Applications for shares exceeded the proposed allocation, and the planned capital structure was revised. On commencing business, the bank acquired several private banks and opened offices across North Wales and the border region. Branches were established in places including Bishop’s Castle, Newtown, Welshpool, Llanfyllin, Oswestry, Ruthin, Llanrwst, Caernarfon, Chester, Mold and Wrexham. The collapse of the Northern & Central Bank of England provided a further opportunity for expansion, as the North and South Wales Bank took over eight of that institution’s branches in North Wales. The institution also acquired Bank y Llong in Aberystwyth in 1836. Its Aberystwyth operations later moved between premises as the town developed. Other notable branch histories included Wrexham, Rhyl and Llangollen. These local offices served as durable markers of the bank’s presence in Welsh communities, although many later passed into the Midland Bank network or were eventually closed. Liverpool remained the bank’s permanent headquarters. It operated from James Street until 1873, when it moved to 62 Castle Street. From the 1860s it developed town branches in Liverpool and expanded into the suburbs and the Wirral. These offices served industrial, shipping and trading customers, creating a useful balance with the agricultural and rural business handled by branches in Wales, Cheshire and Shropshire. The acquisition of Leyland and Bullins in 1901 added a banking business with established shipping and cotton connections. The bank’s reputation rested substantially on its staff and administrative systems. George Rae was associated with an emphasis on recruitment, training and accurate bookkeeping. The institution was distinctive for the number of managers and clerks able to use Welsh, which helped it operate within Welsh-speaking communities. R. Meredith Jones served as Liverpool manager from 1868 to 1894, while Rowland Hughes was general manager from 1897 until 1908. These bankers formed part of the institution’s professional legacy. The bank was profitable during much of the period from 1868 to 1895, but its position later weakened. The business cycle affecting the cotton industry and the wider consequences of the Panic of 1907 placed pressure on the institution. In November 1908 it merged with Midland Bank. At the time of the transaction, the bank had a reported paid-in capital of £750,000, reserves of £512,000, deposits of £11 million, and advances and bills of approximately £7.5 million; these figures are historical transaction-period figures rather than current financial data. Sir Edward Holden, Midland’s chairman and managing director, was a leading force behind the merger. The takeover ended the bank as an independent corporate institution. Its branches and staff became part of Midland Bank, and its Liverpool premises continued in banking use under the acquiring group. The merger also terminated the bank’s right to issue banknotes. Because nineteenth-century private banks could retain note-issuing rights under rules associated with the Bank Charter Act 1844, the withdrawal of the North and South Wales Bank’s notes was historically significant: it ended Welsh private banknote issuance. Later political proposals to restore Welsh note-issuing powers have sometimes referred to this loss of monetary distinctiveness.

• 1908

  Merged into Midland Bank

  [1]The North and South Wales Banken.wikipedia.org

  The bank was absorbed by Midland Bank, ending its independent existence and transferring its branches and staff to the larger network.

• 1908

  Welsh banknote issuance ended

  [1]The North and South Wales Banken.wikipedia.org

  The takeover led to withdrawal of the bank’s notes and ended the ability of a Welsh bank to issue its own currency notes.

• 1901

  Leyland and Bullins acquired

  [1]The North and South Wales Banken.wikipedia.org

  The acquisition strengthened the bank’s Liverpool business and its relationships with shipping and cotton interests.

• 1873

  Liverpool headquarters moved to Castle Street

  [1]The North and South Wales Banken.wikipedia.org

  The bank moved its Liverpool headquarters from James Street to 62 Castle Street.

• 1864

  Llangollen branch established

  [1]The North and South Wales Banken.wikipedia.org

  A branch was established in Llangollen, where purpose-built premises later became a notable local building.

• 1856

  Rhyl branch established

  [1]The North and South Wales Banken.wikipedia.org

  The bank began operating in Rhyl, initially from premises at old Bodfor House.

• 1836

  Bank established in Liverpool

  [1]The North and South Wales Banken.wikipedia.org

  The North and South Wales Bank began operations in Liverpool with the objective of serving Welsh and border-county commercial districts.

• 1836

  Initial Welsh and border branches opened

  [1]The North and South Wales Banken.wikipedia.org

  The bank opened or acquired offices in a series of towns including Bishop’s Castle, Newtown, Welshpool, Oswestry, Ruthin, Llanrwst, Caernarfon, Chester, Mold and Wrexham.

• 1836

  Bank y Llong acquired in Aberystwyth

  [1]The North and South Wales Banken.wikipedia.org

  The bank took over the Aberystwyth institution known as Bank y Llong, extending its Welsh network.

A regional relationship bank linking Welsh communities and businesses with Liverpool’s commercial and financial economy.

• Business banking · 1836

  Commercial banking

  The bank provided banking services to industrial, manufacturing, mining, agricultural, shipping and trading customers. Its Liverpool offices were particularly connected with commerce, shipping and cotton, while its Welsh and border branches served local businesses and rural economies.

• Banking services · 1836

  Deposits and advances

  Deposits, advances and bills formed the core balance-sheet activities of the institution. The bank used its branch system to gather local deposits and provide credit to customers across Wales, Cheshire, Shropshire, Merseyside and neighbouring districts.

• Currency and payments

  Private banknotes

  Like some other nineteenth-century private banks, the North and South Wales Bank issued its own notes under the legal arrangements preserved by the Bank Charter Act 1844. These notes were withdrawn when the bank was taken over by Midland Bank in 1908.

• 1908

  Accept merger with Midland BankM&A

  Background

  The bank’s independent business had weakened after a profitable late-nineteenth-century period. Exposure to changing cotton-industry conditions and the broader financial disruption surrounding the Panic of 1907 contributed to the decision to combine with a larger institution.

  Action taken

  The North and South Wales Bank merged with Midland Bank in November 1908 under the initiative of Midland chairman and managing director Sir Edward Holden.

  Aftermath

  The bank ceased to operate as an independent institution. Its branches and employees joined Midland’s network, and its banknotes were withdrawn, ending Welsh private banknote issuance.

  Paid-in capital, reserves, deposits, and advances and bills at the merger. Paid-in capital £750,000; reserves £512,000; deposits £11 million; advances and bills approximately £7.5 million (1908)

  Source

1. 1The North and South Wales Banken.wikipedia.org