Early history
Midland Bank was founded by Charles Geach, its first manager in Union Street, Birmingham, 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.[5] In the 1830s and 1840s, Midland offered discounted bills of exchange for customers.[5] By the 1850s the bank's customers included railways, iron founders and engineering concerns, utilities and municipal corporations.[5]
Midland acquired Stourbridge Old Bank in 1851 and Nichols, Baker and Crane of Bewdley in 1862.[5]
Acquisitions and development in its first 50 years
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 Bankers' Clearing House, in 1898 it bought the City Bank[5] (which provided a London head office), in 1901 it acquired the Sheffield Union Bank, in 1913 the Sheffield and Hallamshire Bank and, in 1914, it acquired the Birmingham Banking Company.[6]
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 twenty bank amalgamations between 1891 and 1918, and opened new branches throughout England and Wales.[5]
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.[5]
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.[5]
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).[5] In 1958, it acquired Forward Trust, which became a leader in instalment finance, leasing and factoring services.[5]
In 1967, Midland acquired a share in Montagu Trust, the owner of Samuel Montagu & Co., 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.[5]
Through the acquisition of Samuel Montagu & Co, Midland also gained a majority share in Guyerzeller Bank AG (now HSBC Guyerzeller Bank) in Switzerland.[5]
Midland joins the HSBC Group
The Hongkong and Shanghai Banking Corporation acquired a 14.9% equity interest in Midland Bank in 1987, and a strong working relationship developed. In October 1989, First Direct was established and was at the forefront of telephone banking, with person to person service available twenty four hours a day, 365 days a year.[5]
In June 1992, following a brief bidding war with Lloyds Bank, 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 a major foothold in Europe, which it needed to complement its existing business in Asia and the Americas, when it had to move its Hong Kong–based headquarters to London on 1 January 1993, accepting primary banking supervision by the Bank of England.
In 1997, Midland Bank underwent a total rebrand to match its parent company, with its familiar griffin logo being dropped after 32 years in favour of the HSBC "hexagon" symbol, albeit with the "Midland Bank" name placed next to it. Midland Bank was renamed HSBC Bank in June 1999, as part of the adoption of the HSBC brand throughout the Group. Prior to this, a Midland Bank branch in Croydon became the first to bear the HSBC name in the UK, albeit with "Midland Bank plc" still featuring on the plaque near the entrance.
