List of 7 Famous Oldest Banks of the World

List of seven famous oldest banks of the world which had modern banking system in its early stages:- 1. Berenberg Bank (German 1590 AD) 2. C.Hoare & Co. (1672) 3. Barclays Bank (1690) 4. The Bank of Scotland (1695) 5. Weglin & Co. Private Bankers (1741) 6. Private Banks of Switzerland 7. The Bank of New York (1784).

1. Berenberg Bank (German 1590 AD):

The bank was founded by two brothers Hans & Paul. In 16^th century Humburg a German city was a Refuge for Dutch people also. Among these were living two brothers Hans & Paul engaged in the business of cloths. Their business was across the boarders also. Dutch people were refugees and were living in Humberg with certain restrictions.

Latter on the German Government took liberal view and these people were allowed citizenship of the city. A Fund known as Dutch Poor Fund was also founded to help the refugees.

This fund used to maintain the list of Dutch people living in Humburg. Having their trade across the boarder the two Dutch brothers slowly starting dealing in money particularly in trade receipts issued by traders across the boarder. With growth of the business the Berenberg bank came into existence in 1590.

2. C.Hoare & Co. (1672) Beginning of Banking by Gold Smiths:

C.Hoare & Co. was a family business of Gold smiths and were well known in the business circle. Sir Richard Hoare and his elder brother Henry Hoare were deeply involved in Gold Smith business While the Elder brother Henry Hoare inherited the Estate of the family, Richard Hoare was trained in the family business of Goldsmiths.

As per the will of his father Mr. Richard Hoare was required to work as apprentice in the family business of Gold smith. In 17^th century due to ante usury (interest) laws in Britain prevented development of modern banking but because of development of monetary system based on Gold and Silver there was a need for safe-keeping storage to deposit these metals by traders and others.

The Gold Smiths had already been having vaults to safeguard their goods. Other peoples were using such vaults of goldsmiths for safe keeping there own goods against some fee.

Richard Hoare a Gold Smith by occupation had already inherited such vaults to safe Guard his valuables and that of others also. A number of Goldsmiths having the facility of safe vaults started accepting deposits of coins and other Valuables with intention to earn some extra money charged as fee for providing vault services.

When people deposited their money or other valuables they were issued receipts by virtue of which they used to reclaim or withdraw their deposits from Gold Smiths. The depositors could use these receipts as a medium of payments or transfer of money also. In case of transfer of money only the receipt was transferred whereas actually deposit remained safe in the vault of Goldsmiths.

Later on these receipts were also known as notes which were trusted proof of a holder’s ability to pay for any transaction. Gold smiths began accepting deposits also with the result big tradesmen and business men started keeping their running cash in safe deposit vaults.

Hoare’s Bank was founded in July 1672. Initially the business was confined to a place known as Cheapside located in London. During those days there was no system of numbering the streets and the business houses were traced on the basis of their adopted signs (Today we say Trade Mark) and sign of Hoare’s business was Golden Bottle. As guided during those days Bottles were sign of Luxury and Wealth used by Gold Smiths.

The safety vaults oh Hoare & Co. was already accepting the deposits and issuing receipts. They also started issuing notes which were widely accepted by the people. By 1677 about 60 goldsmiths kept “running Cash” with Hoare’ bank. By 1690 the Banking side of Hoare’s business became dominant and Richard Hoare moved the business to new premises to Fleet Street an important financial and legal centre in London. He continued trading at the sign of Golden bottle.

During the 18^th century the bank became well known and established one. It now started not only lending money for interest but also started investments. In 1972 Richard became Mayor of London. In the wake of mushroom growth of unregulated banking activities British Govt. brought the Bank Charter Act 1833 due to which thousands of private banks disappeared But being strong Hoare’s bank not only survived but maintained steady grow.

In the middle of 19^th century there was some slowdown in the business of this bank being partnership of family members only again regained its popularity. In 20^th century also after the First World War many private banks were absorbed by the bigger banks but this bank was not merged and today is the sole survivor as and Independent Bank. It was a partnership until 1929 when it was converted into a private unlimited liability company in which previous partners were the sole shareholders.

3. Barclays Bank (1690):

In 17^th century Mr. Johan Freame and Mr. Thomas Gould were contemporary of Sir Richard Hoare in business of Goldsmiths in Lombard Street, London. The initial business was that of Gold Smith’s and provided secured storage – houses for depositing running cash and valuables by other agents on a nominal fee. They also used to provide credit to traders and merchants on interest and as such were working like a Bank.

In 1736 Mr. James Barclay the son-in-law of founder member Mr. Johan Freame became partner in the business and since than they adopted the Name Barclays. While Sign of the Hoare’s &Co. was a Golden Bottle the Sign of Barclay was “Black Spread Eagle”.

In 1776 the Name of the Bank was changed as “Barclay, Bevan and Bening: Again in 1785 it was changed as “Barclay, Beavan, Barclay and tritto” due to joining of new partners into the business. The banking business was growing and around 1896 many small banks merged and new name became Barclay & Co. a joint stock Bank expanded its activities.

In 1918 the London, provincial and South Western Bank was amalgamated in Barclay bank and next year in 1919 British linen Bank was acquired by Barclay Bank. This is also one of the oldest banks which is toady one of the famous banks with strong history.

4. The Bank of Scotland (1695):

The motive behind opening of the Bank of Scotland in 1695 was mainly to provide a banking system for long term credit and security for traders, merchants and depositors. Because the Bank of England which was established only one year earlier was mainly transacting with Government only for its defence spending.

The Bank was founded on 17^th July 1695 by an Act of Scottish Parliament. But it started functioning only in 1696. It was also one of the first Banks in U.K. The Bank was first to issue Paper Currency in Europe. This bank survived many ups and down during financial crises and now is known as Halifax Bank of Scotland a wholly owned subsidiary of Lloyds Banking Group.

5. Weglin & Co. Private Bankers (1741):

Wegelin & Co. is Switzerland’s Oldest Bank which was founded in 1741. Perhaps it may also be one of the oldest banks in the world. In fact the Swiss banking system can be traced back to early 16^th century for the purpose of financial business. Even today Switzerland is known as land of Watch Makers.

Exporting Watches and Importing cloth were flourishing in Switzerland in 17^th century which gave a boost to persons dealing in money and finance who started developing private banking systems. During this period St. Gallen was a cultural and trade center. Mr. Caspar Zyli was not a Gold Smith like Mr. Hoare and Mr. Barclay. He by his profession was managing a transport company.

During the course of conducting transport business, Payments were executed, Bills of Exchange were brokered and huge amount of cash was managed. A large number of people used to come into his contact.

Since transport business was on high scale the volume of wealth and assets of the company were in corresponding proportions. People therefore started taking his advise for the purpose of investment and management of wealth. All these activities combined together took a shape a banking company as private bankers.

6. Private Banks of Switzerland:

Private banks in Switzerland are considered heaven for investors. The Term “Private Bank” is specifically defined under the Swiss Banking Law.

It applies to Banks whose legal status is:

a) Sole ownership,

b) Registered Partnership,

c) Limited Partnership, and

d) Limited Partnership with share.

At least one partner must have shares with unlimited liability for the bank’s commitments in order to attain the status of a Private Bank.

The Wegelin & Co. is still known as one of the most advanced and professionally managed Bank.

7. The Bank of New York (1784):

Immediately after the America became a new Republic the Bank of New York was established in 1784. The concept was devised by Mr. Alexander Hamilton who was highly respected Attorney of New York city. He not only drafted the constitution of this bank but also during early years he involved himself with development and organizational activities of the Bank.

With Mr. Hamilton’s Economic & Financial vision the bank could establish itself on strong footings. Mr. Hamilton later became the first U.S.Secretary of the Treasury. After becoming a Republic there started a type of Industrial Revolution in America. A company known as Mellon Financial Corporation was playing a key role by way of funding and investing in new businesses.

These days Mr. Andrew Mellon was America’s foremost one of financial industrialists and also a philanthropist. As. Mr. Hamilton Mr. Mellon was also appointed as U.S.Secretary of the Treasury. In the year of 2007 The Mellon Financial Corporation was merged with the Bank of New York and its name was changed as The Bank of New York Mellon.