Bank of Scotland

Timeline

1. 1695Parliament House, Edinburgh · EdinburghThe Scottish Parliament passed the bank-establishing act, granting a 21-year public banking monopoly, limited liability for shareholders, and a nominal capital of £1.2 million Scottish pounds (about £100,000 sterling). A final clause once provided that foreign-born shareholders be deemed naturalized Scots. London merchant John Holland was entrusted with drafting the charter and act text and was elected first governor. That same session the parliament also chartered the Company of Scotland, forming a parallel financial and colonial experiment.
2. 1696Old Town, Edinburgh · EdinburghAfter capital was raised the bank opened in February 1696, with George Watson as first chief accountant. It lent to domestic industry and commerce and issued paper money to ease the cash shortage. Unlike the Bank of England, it could not lend to government without parliamentary approval, positioning the public bank as trade infrastructure rather than a war chest.
3. 1696–1707Edinburgh · EdinburghThe Darien scheme absorbed much of Scotland's liquid capital, and after the company's failure domestic liquidity tightened further. The Bank of Scotland had to balance commercial lending against preserving reserves, and its clause forbidding unauthorized government lending maintained institutional independence amid political turmoil. After the 1707 Union the bank continued operating as Scotland's note-issuing and clearing institution.
4. 1727The Mound, Edinburgh · EdinburghThe Royal Bank of Scotland was founded in 1727, creating two-bank competition and parallel paper currencies in Scotland. The Bank of Scotland retained note-issuing rights for centuries thereafter, moving its head office to the Mound. In the 21st century it merged into Lloyds Banking Group but still issues Scottish banknotes under an independent brand, continuing the public bank lineage begun by the 1695 parliamentary act.