Commercial Bank of Scotland

The Commercial Bank of Scotland Ltd. was a Scottish commercial bank. It was founded in Edinburgh in 1810, and obtained a royal charter in 1831. It grew substantially through the 19th and early 20th centuries, until 1958, when it merged with the National Bank of Scotland to become the National Commercial Bank of Scotland. Ten years later the National Commercial Bank merged with the Royal Bank of Scotland.

The Commercial Bank of Scotland was formed in 1810 in response to public dissatisfaction with the three charter banks (Bank of Scotland, British Linen Bank and The Royal Bank of Scotland: ”it was felt by many of the Scottish people that the three old Banks had become too…devoted to their own interests…to be the real promoters of the general good.” Checkland argued that the project was “without precedent” for the proposed joint stock company relied not on a restricted group of wealthy men but on “a very large group of investors, including those of more modest means, numbered in hundreds, distributed throughout Scotland”.

It was always the intention to create a national branch structure and Bank’s note issue was used as a form of early advertising: “it was the policy of the directors to arrange for note `circulators` throughout the country as a preliminary to actual agencies, the object being to familiarize the general public with the new Bank”. The Commercial enjoyed immediate success and within twelve months it was “doing a fair proportion of the Banking business in Edinburgh and Leith”, and had five branches outside the City. Within two years there were 11 branches and 30 by 1830. This success was despite the first manager having no banking experience and being “slow to learn” to the extent that he was removed in little more than a year. His successor, Alexander MacArtney, had been trained by private bankers and “was a man of real depth and ability”.

The Bank had been keen to obtain a Royal Charter from the outset but it did not succeed until 1831. The title figure chosen to be the nominal head of the Bank was James Maitland, 8th Earl of Lauderdale, the first of four Earls of Lauderdale to serve as Governor over a period of fifty years.

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