page_title: Clydesdale Bank plc
section_title: Expansion
hierarchical_section_title: Clydesdale Bank plc / History / Expansion
caption_attribution_description: English: Clydesdale Bank, Leith
context_page_description: Clydesdale Bank plc is a commercial bank in Scotland. Formed in Glasgow in 1838, it is the smallest of the three Scottish banks. Independent until it was purchased by Midland Bank in 1920, it formed part of the National Australia Bank Group between 1987 and 2016. Clydesdale Bank was divested from National Australia Bank in early 2016 and its holding company CYBG plc, trades on the London and Sydney stock exchanges. In June 2018, it was announced that Clydesdale Bank's holding company CYBG would acquire Virgin Money for £1.7 billion in an all-stock deal, and that the Clydesdale and Yorkshire Bank brands would be phased out in favour of retaining Virgin's brand. CYBG plc's banking businesses, Clydesdale Bank, Yorkshire Bank, Virgin Money and B, currently operate as trading divisions of Clydesdale Bank plc under its banking licence.
  As with two other Scottish banks, the Bank of Scotland and the Royal Bank of Scotland, Clydesdale Bank retains the right to issue its own banknotes.
context_section_description: Following the purchase of the Greenock Union, there was little change in the structure of the Bank and there were still only 13 branches in 1857. In that year, Clydesdale became the first Scottish bank to produce a printed balance sheet, and it showed assets of £2.7 million and net profits of £70,000. The public disclosure of its strength stood it in good stead, for only months later the Western Bank of Scotland closed its doors, followed the next day by the first closure of the City of Glasgow Bank. Clydesdale gained not only customers but 13 branches from the Western. A few months later came the acquisition of the Edinburgh and Glasgow Bank, which had been weakened by the same economic disturbances. The Edinburgh & Leith Bank, as it was originally, had been formed in 1838 "for the benefit of the 'industrious middle classes'" and it had bought the Dumfries-based Southern Bank of Scotland in 1842 and the Glasgow Joint Stock Bank in 1844, the latter leading to the change of name to Edinburgh & Glasgow Bank. Poor lending in the 1845–47 period, particularly to Australia, dogged the Bank for the next ten years and it was eventually taken over by the Clydesdale for a nil consideration; Clydesdale retained 19 of its 27 offices. Five years later, in 1863, Clydesdale acquired the more successful Eastern Bank of Scotland, like Clydesdale, also founded in 1838. Based in Dundee it was to have two separate offices and boards, one in Dundee, the other Edinburgh. Before opening for business it acquired the Dundee Commercial Bank to serve as its Dundee office. Difficulties with the two boards working together led to the Edinburgh bank being wound up and the Eastern became an essentially Dundee bank; its acquisition gave Clydesdale its first interests north of the River Tay.
  Much of the growth in the Bank's network had come from acquisitions and the management remained cautious regarding direct branch expansion. However, in 1865, a committee was formed to look at prospects and 16 branches were opened in two years. In 1874 the Clydesdale went south of the border and opened three branches in Cumberland but this was seen as following existing trade rather than making a specific attempt to enter the English market. Indeed, Clydesdale was one of the last Scottish banks to acquire a London office (1877). In 1878, the City of Glasgow Bank failed for the second time, leading again to an increase in Clydesdale's deposits and the acquisition of nine of the Glasgow branches. The scale of the collapse led to further debate on the desirability of limited liability and, following legislation in 1879 (allowing fixed uncalled liability on shares), Clydesdale Bank registered as a limited liability company in 1882.
  Reid described the period 1890–1914 as "the tranquil years", but that did not preclude steady expansion of the branch network – from 92 to 153. That was to mark the end of Clydesdale's independent existence. In 1917 the bank was approached by London City and Midland (later Midland Bank) and, although initially resisted, Clydesdale Bank was sold in 1920. However, it continued to operate independently and was always referred to as an affiliate, not a subsidiary. The Glasgow banks suffered more than others in the depressed economy of the inter-war period and from being the largest lender in Scotland in 1920, it fell to fifth place by 1939. Despite this, the Bank continued to open branches, particularly in areas enjoying export growth, and the network increased from 158 in 1919 to 205 in 1939.
caption: A former branch of Clydesdale Bank in Leith
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