Previous posts have covered why Sir Walter Scott appears on the banknotes of the Bank of Scotland. The Bank of Scotland itself was formed on July 17, 1695. According to Andrew Kerr, in his "History of Banking in Scotland, 'It was in the midst of the experiences described in the last chapter [the Darien Expedition] that the earliest of Scottish banks came into existence, and passed the first few years of its career. On the 17th July 1695, three weeks after the incorporation of the African and Indian Company, the Scots Parliament passed an "Act for erecting a Publick Bank," which, together with six other Acts subsequently obtained, forms the constitution of the Bank of Scotland. The preamble recites how " Our Sovereign Lord, considering how useful a Publick Bank may be in this Kingdom, according to the custom of other Kingdoms and States; and that the same can only be best set forth and managed by Persons in Company with a Joynt Stock, sufficiently indued with these Powers, and Authorities, and Liberties, necessary and usual in such Cases; Hath therefore Allowed, and, with the Advice and Consent of the Estates of Parliament, Allows a Joynt Stock, amounting to the Sum of Twelve Hundred Thousand Pounds [Scots] Money, to be raised by the Company hereby Established for the Carrying and Managing of a Publick Bank. And further Statutes and Ordains, with Advice foresaid, That" certain persons named should have power to receive subscriptions from the 1st November to the 1st January succeeding, and that the subscribers "are hereby Declared to be One Body Corporat and Politick, by the Name of the Governour and Company of the Bank of Scotland."...'
Showing posts with label Andrew Kerr. Show all posts
Showing posts with label Andrew Kerr. Show all posts
Sunday, July 17, 2011
Friday, March 25, 2011
Bank Founding
The Commercial Bank of Scotland was founded on March 25, 1810. The Commercial Bank changed banking in Scotland, which at that time was controlled by private banking firms. Bank historian Andrew Kerr ("History of Banking in Scotland") contrasts Commercial Bank's approach to the status quo:
'The connection between the Bank of Scotland and the Royal Bank on the one hand, and their respective sets of banking customers on the other hand, became more and more intimate, until partners of private banking firms not only got seats on the bank boards, but actually to a large extent controlled the proceedings of the latter. Business men then began to find it irksome to have to pass their business through the strait gate of the private bank, where toll had to be paid, as the only practical way of obtaining the benefit of the public banks' accommodation; for they believed, rightly or wrongly, that the private banker would refuse at the board meeting to approve of paper which he would readily discount in his own office. It was one great feature of the Commercial Bank to counteract this state of matters; and accordingly it was made a rule of their constitution that no private banker could hold the office of director. This was practically the death-blow to private banking in Edinburgh; for, although many firms continued to exist for years afterwards, the system was ever on the wane. The new establishment was very popular, but it was also very discreet; for while it studied the best interests of the public, it imitated the wisest provisions of the old banks' practice. In short, the founders of the Commercial Bank evinced an amount of true wisdom, which, while it produced great advantage to themselves, was at the same time largely beneficial to the general community. It must not be supposed, however, that the new bank at once sprang into the position of a compeer of the old banks. It commenced on a scale much inferior to their resources, and although it had public favour, it was destitute of the prestige and influence, and accumulated wealth, which placed the old banks in those days on a distinctly elevated platform...'
Founders of the Commercial Bank (through mergers now part of RBS) included John Pitcairn and Henry Cockburn. Cockburn and Walter Scott were both at one point in their lives members of The Speculative Society. Cockburn published in the Edinburgh Review, and late in life authored a biography of Francis Jeffrey and "Memorials of his Time".
'The connection between the Bank of Scotland and the Royal Bank on the one hand, and their respective sets of banking customers on the other hand, became more and more intimate, until partners of private banking firms not only got seats on the bank boards, but actually to a large extent controlled the proceedings of the latter. Business men then began to find it irksome to have to pass their business through the strait gate of the private bank, where toll had to be paid, as the only practical way of obtaining the benefit of the public banks' accommodation; for they believed, rightly or wrongly, that the private banker would refuse at the board meeting to approve of paper which he would readily discount in his own office. It was one great feature of the Commercial Bank to counteract this state of matters; and accordingly it was made a rule of their constitution that no private banker could hold the office of director. This was practically the death-blow to private banking in Edinburgh; for, although many firms continued to exist for years afterwards, the system was ever on the wane. The new establishment was very popular, but it was also very discreet; for while it studied the best interests of the public, it imitated the wisest provisions of the old banks' practice. In short, the founders of the Commercial Bank evinced an amount of true wisdom, which, while it produced great advantage to themselves, was at the same time largely beneficial to the general community. It must not be supposed, however, that the new bank at once sprang into the position of a compeer of the old banks. It commenced on a scale much inferior to their resources, and although it had public favour, it was destitute of the prestige and influence, and accumulated wealth, which placed the old banks in those days on a distinctly elevated platform...'
Founders of the Commercial Bank (through mergers now part of RBS) included John Pitcairn and Henry Cockburn. Cockburn and Walter Scott were both at one point in their lives members of The Speculative Society. Cockburn published in the Edinburgh Review, and late in life authored a biography of Francis Jeffrey and "Memorials of his Time".
Wednesday, November 3, 2010
Darien Expedition Lands
On November 3, 1698, the ill-fated Darien expedition landed on the Isthmus of Panama. According to bank historian Andrew Kerr ("History of Banking in Scotland"), 'The expedition consisted of five well-armed ships, laden with merchandise, and having twelve hundred men on board. They arrived at their destination with but small loss, and the colony was formally established as New Caledonia, with New Edinburgh as its chief town. ...'
Sir Walter Scott's information largely agrees with Kerr's. Scott covers the Dairen Scheme in his "Tales of a Grandfather".
'Twelve hundred men, three hundred of whom were youths of the best Scottish families, embarked on board of five frigates, purchased at Hamburgh for the service of the expedition ; for the King refused the Company even the trifling accommodation of a ship of war, which lay idle at Burntisland. They reached their destination in safety, and disembarked at a place called Acta, where, by cutting through a peninsula, they obtained a safe and insulated situation for a town, called New Edinburgh, and a fort named Saint Andrew. With the same fond remembrance of their native land, the colony itself was called Caledonia. They were favourably received by the native princes, from whom they purchased the land they required. The harbour, which was excellent, was proclaimed a free port; and in the outset the happiest results were expected from the settlement.
The arrival of the colonists took place in winter, when the air was cool and temperate ; but with the summer returned the heat, and with the heat came the diseases of tropical climate. Those who had reported so favourably of the climate of Darien, had probably been persons who had only visited the coast during the healthy season, or mariners, who, being chiefly on shipboard, find many situations healthy, which prove pestilential to Europeans residing on shore. The health of the settlers accustomed to a cold and mountainous country, give way fast under the constant exhalations of the sultry climate, and even a more pressing danger arose from the want of food. The provisions which the colonists had brought from Scotland were expended, and the country afforded them only such supplies as could be procured by the precarious success of fishing and the chase. ...'
The Darien colony was abaondoned less than two years later.
Sir Walter Scott's information largely agrees with Kerr's. Scott covers the Dairen Scheme in his "Tales of a Grandfather".
'Twelve hundred men, three hundred of whom were youths of the best Scottish families, embarked on board of five frigates, purchased at Hamburgh for the service of the expedition ; for the King refused the Company even the trifling accommodation of a ship of war, which lay idle at Burntisland. They reached their destination in safety, and disembarked at a place called Acta, where, by cutting through a peninsula, they obtained a safe and insulated situation for a town, called New Edinburgh, and a fort named Saint Andrew. With the same fond remembrance of their native land, the colony itself was called Caledonia. They were favourably received by the native princes, from whom they purchased the land they required. The harbour, which was excellent, was proclaimed a free port; and in the outset the happiest results were expected from the settlement.
The arrival of the colonists took place in winter, when the air was cool and temperate ; but with the summer returned the heat, and with the heat came the diseases of tropical climate. Those who had reported so favourably of the climate of Darien, had probably been persons who had only visited the coast during the healthy season, or mariners, who, being chiefly on shipboard, find many situations healthy, which prove pestilential to Europeans residing on shore. The health of the settlers accustomed to a cold and mountainous country, give way fast under the constant exhalations of the sultry climate, and even a more pressing danger arose from the want of food. The provisions which the colonists had brought from Scotland were expended, and the country afforded them only such supplies as could be procured by the precarious success of fishing and the chase. ...'
The Darien colony was abaondoned less than two years later.
Sunday, April 11, 2010
Darien Scheme
On April 11, 1700, the Scottish settlement of Darien was abandoned. The Darien Company began as the first large-scale Scottish joint-stock company. Its formation was encouraged by the passage of the Act, William and Mary 1693, which included a chapter (34) "for the encouraging of foreign trade". This act effectively promised William's protection for such endeavors. Darien was the brainchild of financier William Paterson.
Paterson attempted, and failed, to obtain funding for his proposed trading colony on the Isthmus of Darien (Panama) in England and Holland. Eventually, he turned to his native Scotland, where the project found substantial interest. Scotland was a poor country at this time. According to bank historian Andrew Kerr, Scotland's total currency did not exceed L800,000. The Darien Company, after initial success in Scotland, reached a subscribed funding of approximately L400,000, half of which was paid up. This was clearly an enormous investment for a Scottish enterprise.
The first ships bound for Darien left on July 26, 1698; a flotilla of 5 well armed vessels. Two further expeditions were to follow. Far from protection, the colonists found that rival English colonies in the West Indies and Americas were forbidden to sell food to the Darien group. Darien was attacked by a much larger Spanish force, and finally the colonists were forced to leave Panama.
Several Scottish writers have commented on this catastrophe, including Tobias Smollett: "The clamor in Scotland increased against the ministry, who had disowned their company, and in a great measure defeated their design, from which they had promised themselves such heaps of treasure.... At Madeira they took in a supply of wine, and then returned to Crab Island, in the neighborhood of. St. Thomas, lying between Santa Cruz and Porto Rico. Their design was to take possession of this little island; but when they entered the road, they saw a large tent pitched upon the strand, and the Danish colors flying. Finding themselves anticipated in this quarter, they directed their course to the coast of Darien. . . . "
Regarding Darien, Walter Scott commented that "Nothing could be heard throughout Scotland but the language of grief and of resentment. Indemnification, redress, revenge, were demanded by every mouth, and each hand seemed ready to vouch for the justice of the claim. For many years no such universal feeling had occupied the Scottish people."
Paterson attempted, and failed, to obtain funding for his proposed trading colony on the Isthmus of Darien (Panama) in England and Holland. Eventually, he turned to his native Scotland, where the project found substantial interest. Scotland was a poor country at this time. According to bank historian Andrew Kerr, Scotland's total currency did not exceed L800,000. The Darien Company, after initial success in Scotland, reached a subscribed funding of approximately L400,000, half of which was paid up. This was clearly an enormous investment for a Scottish enterprise.
The first ships bound for Darien left on July 26, 1698; a flotilla of 5 well armed vessels. Two further expeditions were to follow. Far from protection, the colonists found that rival English colonies in the West Indies and Americas were forbidden to sell food to the Darien group. Darien was attacked by a much larger Spanish force, and finally the colonists were forced to leave Panama.
Several Scottish writers have commented on this catastrophe, including Tobias Smollett: "The clamor in Scotland increased against the ministry, who had disowned their company, and in a great measure defeated their design, from which they had promised themselves such heaps of treasure.... At Madeira they took in a supply of wine, and then returned to Crab Island, in the neighborhood of. St. Thomas, lying between Santa Cruz and Porto Rico. Their design was to take possession of this little island; but when they entered the road, they saw a large tent pitched upon the strand, and the Danish colors flying. Finding themselves anticipated in this quarter, they directed their course to the coast of Darien. . . . "
Regarding Darien, Walter Scott commented that "Nothing could be heard throughout Scotland but the language of grief and of resentment. Indemnification, redress, revenge, were demanded by every mouth, and each hand seemed ready to vouch for the justice of the claim. For many years no such universal feeling had occupied the Scottish people."
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