Barclays, one of the world's oldest banks, has a history dating back to 1690. Founded by John Freame and Thomas Gould, it began as a goldsmith banking business in London. Over the centuries, Barclays has grown into a global financial powerhouse, known for pioneering innovations like the UK's first credit card, Barclaycard, in 1966, and the world's first cash machine in 1967. The bank's journey includes significant acquisitions, such as Lehman Brothers' investment banking division in 2008, and notable milestones, like appointing the UK's first female bank manager in 1958. Barclays' rich history is marked by both triumphs and controversies, reflecting its complex legacy in the financial world.
Barclays: A Banking Legacy Since 1690
Barclays has been a cornerstone of the financial world for over three centuries. From its early days as a goldsmith banking business to its current status as a global financial powerhouse, Barclays has a storied history filled with notable milestones and achievements.
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Founding: Barclays began on November 17, 1690, when John Freame and Thomas Gould started trading as goldsmith bankers in Lombard Street, London.
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Name Association: The name "Barclays" became linked to the business in 1736 when James Barclay, Freame's son-in-law, joined as a partner.
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Early Expansion: By 1728, the bank moved to 54 Lombard Street, identified by the "Sign of the Black Spread Eagle," a symbol that remains part of its identity.
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Slavery Connections: The Barclay family had complex ties to slavery. David and Alexander Barclay were involved in the slave trade in 1756, while David Barclay of Youngsbury (1729–1809) was an abolitionist who freed his slaves in Jamaica.
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Business Name Changes: The firm was known as "Barclay, Bevan and Bening" from 1776 to 1785, then "Barclay, Bevan, Bening and Tritton" after John Tritton joined in 1785.
Growth and Expansion in the 19th and 20th Centuries
Barclays' growth in the 19th and 20th centuries was marked by numerous mergers, acquisitions, and innovations that helped it become a major player in the banking industry.
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Joint-Stock Bank: In 1896, twelve houses in London and the English provinces united to form Barclays and Co., a joint-stock bank holding about a quarter of deposits in English private banks.
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Branch Network Expansion: Between 1905 and 1916, Barclays expanded its branch network by acquiring small English banks. It also merged with the London, Provincial and South Western Bank in 1918 and acquired the British Linen Bank in 1919.
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Overseas Operations: In 1925, Barclays merged the Colonial Bank, National Bank of South Africa, and the Anglo-Egyptian Bank, operating overseas as Barclays Bank (Dominion, Colonial and Overseas) or Barclays DCO.
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Indian Exchange Bank: In 1938, Barclays acquired the Central Exchange Bank of India, which had opened in London in 1936 with the Central Bank of India's sponsorship.
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WWII Controversy: During World War II, a Paris branch worked with German occupation forces, volunteering names of Jewish employees and ceding Jewish bank accounts to the Germans. Marcel Cheradame, the branch manager, remained in his position until retirement in the 1960s.
Pioneering Innovations and Milestones
Barclays has been at the forefront of banking innovations, introducing several firsts in the industry.
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First Female Bank Manager: In May 1958, Barclays appointed Hilda Harding as the first female bank manager in the UK, managing the Hanover Square branch in London until her retirement in 1970.
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US Affiliate: In 1965, Barclays established a US affiliate, Barclays Bank of California, in San Francisco.
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Barclaycard: Barclays launched the first credit card in the UK, Barclaycard, in 1966.
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Cash Machine: On June 27, 1967, Barclays deployed the world's first cash machine at its Enfield branch, with British actor Reg Varney being the first person to use it.
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Merger Attempts: In 1969, a planned merger with Martins Bank and Lloyds Bank was blocked by the Monopolies and Mergers Commission, but Barclays acquired Martins Bank on its own later that year.
Modern Era: Challenges and Achievements
The modern era has seen Barclays navigate through challenges and achieve significant milestones, solidifying its position as a global financial institution.
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British Linen Bank: The British Linen Bank subsidiary was sold to the Bank of Scotland in exchange for a 25% stake in 1971.
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Banca Barclays Castellini: From 1972 until 1980, Barclays owned a minority stake in Banca Barclays Castellini SpA in Milan. In 1980, Barclays acquired the remaining stake from the Castellini family.
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Mercantile Credit Company: Following the secondary banking crash in 1975, Barclays acquired Mercantile Credit Company.
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Edgar Pearce's Terror Campaign: In 1994, Edgar Pearce began a terror campaign against Barclays and Sainsbury's supermarket chain.
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Wells Fargo Nikko Acquisition: In 1996, Barclays bought Wells Fargo Nikko Investment Advisors (WFNIA) and merged it with BZW Investment Management to form Barclays Global Investors.
Transformations and Strategic Moves
Barclays has undergone several transformations and strategic moves to adapt to the changing financial landscape.
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BZW Business Split: In 1998, the BZW business was broken up, with the Equity and Corporate Finance Divisions sold to Credit Suisse First Boston. Barclays retained the debt-focused Fixed Income business and Structured Capital Markets, forming the foundation of Barclays Capital (BarCap).
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WWII Compensation: In 1998, Barclays agreed to pay $3.6 million to Jews whose assets were seized from French branches of the bank during World War II.
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Barclays.net: In 1999, Barclays launched an internet service called Barclays.net, which was later acquired by British Telecom in 2001.
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Branch Closures: In 2001, Barclays closed 171 branches in the UK, many in rural communities. The bank called itself "The Big Bank," but this name was quickly downplayed after a series of embarrassing PR stunts.
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FirstCaribbean International Bank: On October 31, 2001, Barclays and CIBC agreed to combine their Caribbean operations to establish FirstCaribbean International Bank (FCIB).
Expansion and Acquisitions in the 21st Century
Barclays continued to expand and acquire new businesses in the 21st century, further solidifying its global presence.
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Share Split: In April 2002, Barclays enacted a 4:1 share split.
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Juniper Bank Acquisition: In 2003, Barclays bought the American credit card company Juniper Bank from CIBC and re-branded it as "Barclays Bank Delaware."
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Banco Zaragozano Acquisition: The same year saw the acquisition of Banco Zaragozano, the 11th-largest Spanish bank.
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Premier League Sponsorship: Barclays took over sponsorship of the Premier League from Barclaycard in 2004.
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Headquarters Move: In May 2005, Barclays moved its group headquarters from Lombard Street in the City of London to One Churchill Place in Canary Wharf.
Navigating Financial Crises and Scandals
Barclays has faced its share of financial crises and scandals, yet it has managed to navigate through them and emerge stronger.
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Absa Group Acquisition: Barclays sealed a £2.6 billion takeover of Absa Group Limited, South Africa's largest retail bank, acquiring a 54% stake on July 27, 2005.
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HomEq Servicing Corporation Acquisition: In 2006, Barclays purchased the HomEq Servicing Corporation for $469 million in cash from Wachovia Corp.
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Woolwich Rebranding: Barclays announced plans to rebrand Woolwich branches as Barclays, migrating Woolwich customers onto Barclays accounts and back-office processes onto Barclays systems. The Woolwich brand was to be used for Barclays mortgages.
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Caribbean Operations Exit: Barclays exited retail-banking operations in the Caribbean region, which extended as far back as 1837, by selling its joint venture stake in FirstCaribbean International Bank (FCIB) to CIBC for between $989 million and $1.08 billion.
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Lehman Brothers Acquisition: In September 2008, Barclays announced its agreement to purchase Lehman Brothers' investment banking and trading divisions.
Recent Developments and Innovations
In recent years, Barclays has continued to innovate and adapt to the changing financial landscape, embracing new technologies and strategies.
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Revenues Post-Lehman: By April 2009, Barclays Capital, now including substantial remnants of Lehman, had risen one place from ninth in the first quarter 2008 to eighth with revenues 36% down on the comparable quarter in 2008.
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Leadership Expectations: Despite challenges, Barclays' leaders expected to build dominant positions in both retail and investment banking. The bank's earnings power was enhanced, and it was safe from UK taxpayer support.
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Integration Success: The acquisition and successful integration of the Lehman business resulted in a transformational change in Barclays Capital, where profit before tax was very substantially ahead of last year, rising 361% to £907 million in the first quarter of 2009.
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Bob Diamond's Legacy: Bob Diamond's legacy in numbers was marked by his 16-year rollercoaster career at Barclays. His shock resignation in July 2012 brought an abrupt end to his tenure as group chief executive.
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Libor Scandal Impact: The Libor scandal was unlikely to dent Barclays' earnings and could add impetus to chief executive Bob Diamond's belated cost-cutting drive.
Embracing Technology and Digital Banking
Barclays has embraced technology and digital banking, launching several initiatives to enhance customer experience and streamline operations.
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Best Investment Bank in the US: In 2012, Barclays was named the best investment bank in the United States.
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Trading Name Change: In mid-March 2012, the trading name of Barclays Capital was changed to simply Barclays, and the name of the division was changed to Barclays Investment Bank.
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Mobile Banking Launch: In 2012, Barclays launched mobile banking services, allowing customers to make transfers and pay bills using smartphones and tablets for the first time.
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Digital Eagles Initiative: In April 2013, Barclays announced a new initiative called Digital Eagles aimed at enhancing digital banking services.
Historical Roots and Regional Presence
Barclays' historical roots and regional presence have played a significant role in its growth and development over the years.
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Branch Network in Wales: Barclays' earliest origins in Wales date back to 1827 with a bank established in Haverfordwest by John and William Walters.
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Kent Branch Opening: The bank was first represented in Kent with the opening of a branch in Tunbridge Wells around 1817.
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Bank Charter Act of 1826: The Bank Charter Act of 1826 allowed banks with more than six partners to be formed only outside London.
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Gurney Influence: By 1838, the Gurneys were described as exercising an influence and power inferior to that of no banking establishment in Great Britain except the Bank of England.
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Limited Liability: Stockholders of new joint-stock companies were granted limited liability for the first time in 1854.
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Consolidated Bank of Cornwall: In July 1896, Barclays and nineteen other banks joined together to form Barclay and Company Limited. The Consolidated Bank of Cornwall amalgamated with Barclays and Co in 1905.
Barclays: A Legacy of Innovation and Influence
Barclays' journey from a small goldsmith banking business in 1690 to a global financial powerhouse is nothing short of remarkable. With milestones like launching the UK's first credit card, introducing the world's first cash machine, and acquiring Lehman Brothers' investment banking division, Barclays has consistently been at the forefront of banking innovation. The bank's rich history includes significant expansions, strategic acquisitions, and even controversial moments, such as its WWII activities and involvement in the Libor scandal. Despite these challenges, Barclays has maintained its influence in the financial world, adapting to changing times with initiatives like mobile banking and the Digital Eagles program. From its early days on Lombard Street to its current headquarters in Canary Wharf, Barclays continues to shape the financial landscape, proving that its legacy is built on both tradition and forward-thinking innovation.
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