The Mercantile Bank of India, London and China, later Mercantile Bank Ltd (), was an Anglo-Indian bank with business focus in the Far East. It was founded in Bombay in 1853 as the Mercantile Bank of Bombay; and later in 1857 was renamed to Mercantile Bank of India, London, and China with

London London is the capital and List of urban areas in the United Kingdom, largest city of England and the United Kingdom, with a population of just under 9 million. It stands on the River Thames in south-east England at the head of a estuary dow ...

as its headquarters. By 1959, through a series of mergers and divisions, its name had been shortened to 'Mercantile Bank, Ltd', and was acquired by HSBC the same year. The bank was an issuer of Hong Kong bank notes until 1974.

History

Early years : 1853–1900

The historic bank started life in October 1853 as the Mercantile Bank of Bombay, taking the name of the city,

Bombay Mumbai (, ; also known as Bombay — List of renamed Indian cities and states#Maharashtra, the official name until 1995) is the capital city of the Indian States and union territories of India, state of Maharashtra and the ''de facto'' fin ...

, where it was founded. It expanded its operations to the Far East in November 1854 with the opening of an office in

Shanghai Shanghai (; , , Standard Chinese, Standard Mandarin pronunciation: ) is one of the four Direct-administered municipalities of China, direct-administered municipalities of the China, People's Republic of China (PRC). The city is located on the ...

. In 1857, the bank was granted a

royal charter A royal charter is a formal grant issued by a monarch under royal prerogative as letters patent. Historically, they have been used to promulgate public laws, the most famous example being the English Magna Carta (great charter) of 1215, b ...

, and it established a presence in

Hong Kong Hong Kong ( (US) or (UK); , ), officially the Hong Kong Special Administrative Region of the People's Republic of China (abbr. Hong Kong SAR or HKSAR), is a List of cities in China, city and Special administrative regions of China, special ...

. The name was late changed to the Mercantile Bank of India, London and China, and it moved its headquarters to

in 1858. It competed with the other great British banks of those times, such as the

Oriental Bank Corporation The Oriental Bank Corporation (), or "OBC", was a British imperial bank founded in India in 1842 which grew to be prominent throughout the Far East. As an Exchange bank, the OBC was primarily concerned with the finance of trade and exchanges of ...

, Hongkong and Shanghai Bank and

Chartered Bank of India, Australia and China The Chartered Bank of India, Australia and China (informally The Chartered Bank) was a bank incorporated in London in 1853 by Scotsman James Wilson, under a Royal Charter from Queen Victoria.

; involved in trade between India and China and other British possessions

East of suez East of Suez is used in British military and political discussions in reference to interests beyond the European theatre, and east of the Suez Canal, and may or may not include the Middle East.

. By 1860, its total assets reached the amount of US$21.7 million, a medium-sized bank by the standards of that time - a comparison shows that one of the leading Anglo-Indian banks, the Oriental Bank Corporation was about three times larger in terms of total assets. With the opening of the

Suez Canal The Suez Canal ( arz, قَنَاةُ ٱلسُّوَيْسِ, ') is an artificial sea-level waterway in Egypt, connecting the Mediterranean Sea to the Red Sea through the Isthmus of Suez and dividing Africa and Asia. The long canal is a popula ...

in 1869; and completion of

Indo-European telegraph line Siemens Communications was the communications and information business arm of German industrial conglomerate Siemens AG, until 2006. It was the largest division of Siemens, and had two business units – Mobile Networks and Fixed Networks; and E ...

Page 32 , The Rise of India:
Its Transformation from Poverty to Prosperity by Niranjan Rajadhyaksha
/ref>
by Steven Roberts from London to

Calcutta Kolkata (, or , ; also known as Calcutta , the official name until 2001) is the capital of the Indian state of West Bengal, on the eastern bank of the Hooghly River west of the border with Bangladesh. It is the primary business, commer ...

, and its extension to China in 1871;The foreign banks in China, Part I - (1850-1900)
''The Opening of China to the Outside World'' by John E. Sandrock most British banks (including Mercantile bank) were well placed to expand and develop its business. The bank expanded its presence with branches across India, the

Straits Settlements The Straits Settlements were a group of British territories located in Southeast Asia. Headquartered in Singapore for more than a century, it was originally established in 1826 as part of the territories controlled by the British East India Com ...

and

Federated Malay States )Under God's Protection , capital = Kuala Lumpur1 , religion = Islam , legislature = Federal Legislative Council , type_house1 = State level , common_languages = , title_leader = Monarch , leader1 ...

, and in Hong Kong and Shanghai. It issued banknotes in

Penang Penang ( ms, Pulau Pinang, is a Malaysian state located on the northwest coast of Peninsular Malaysia, by the Malacca Strait. It has two parts: Penang Island, where the capital city, George Town, is located, and Seberang Perai on the M ...

Singapore Singapore (), officially the Republic of Singapore, is a sovereign island country and city-state in maritime Southeast Asia. It lies about one degree of latitude () north of the equator, off the southern tip of the Malay Peninsula, bor ...

and

. It became the issuer of

Hong Kong banknotes The issue of banknotes of the Hong Kong dollar is governed in the Special Administrative Region of Hong Kong by the Hong Kong Monetary Authority (HKMA), the governmental currency board of Hong Kong. Under licence from the HKMA, three commercial ...

for the first time from 1859 to 1892.World Paper Money Catalog and History - Hongkong Dollar
/ref>Collection of Historical banknotes - Hong Kong, Shanghai, China
Trouble in 1893 meant it lost its

charter A charter is the grant of authority or rights, stating that the granter formally recognizes the prerogative of the recipient to exercise the rights specified. It is implicit that the granter retains superiority (or sovereignty), and that the re ...

, and was reconstituted as the Mercantile Bank of India Ltd.

Transition years : 1900–1959

There was a re-consolidation of its operations at the beginning of the 20th century; and in 1912 it again became an issuer of Hong Kong banknotes, a privilege it retained until 1974. During the

Second World War World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the vast majority of the world's countries—including all of the great powers—forming two opposi ...

, the Mercantile Bank had to close down several offices in the Far East, but it managed to re-open its offices after the war. The Hong Kong office re-opened in February 1946 and the

office in 1945, but was closed down its Shanghai operations in 1952 due to the

Communist party A communist party is a political party that seeks to realize the socio-economic goals of communism. The term ''communist party'' was popularized by the title of '' The Manifesto of the Communist Party'' (1848) by Karl Marx and Friedrich Engel ...

rule.255, Chapter , A History of Modern Shanghai Banking. The Rise and Decline of China Finance Capitalism Armonk, New York, London, M. E. Sharpe, 2003, 325 p
/ref> In 1952, total assets of the bank totalled US$205.5 million.

Amalgamation into HSBC and divestment : 1959–1987

The bank was acquired in 1959 by

The Hongkong and Shanghai Banking Corporation The Hongkong and Shanghai Banking Corporation Limited (), commonly known as HSBC (), was the parent entity of the multinational HSBC banking group until 1991, and is now its Hong Kong-based Asia-Pacific subsidiary. The largest bank in Hong K ...

. By then its name had been shortened again, to the Mercantile Bank Ltd. The former office in Bombay now houses the

HSBC Group HSBC Holdings plc is a British multinational universal bank and financial services holding company. It is the largest bank in Europe by total assets ahead of BNP Paribas, with US$2.953 trillion as of December 2021. In 2021, HSBC had $10.8 tr ...

's Head Office in India. The Mercantile Bank continued to issue Hong Kong banknotes until the early 1970s. The signing of the historic

Sino-British Joint Declaration The Sino-British Joint Declaration is a treaty between the governments of the United Kingdom and China signed in 1984 setting the conditions in which Hong Kong was transferred to Chinese control and for the governance of the territory after ...

in 1984, provided HSBC added impetus to expand overseas and sold the entity - Mercantile Bank, Ltd to

Citibank Citibank, N. A. (N. A. stands for " National Association") is the primary U.S. banking subsidiary of financial services multinational Citigroup. Citibank was founded in 1812 as the City Bank of New York, and later became First National City ...

the same year as part of its consolidation strategy. It was eventually sold to the Bank of Tokyo-Mitsubishi, Ltd. in 1987. Not to be confused wit
Bombay Mercantile Bank
which a is Co-operative bank.

References

{{Banking in India Defunct banks of India Defunct banks of Hong Kong Defunct banks of the United Kingdom HSBC acquisitions Banks established in 1853 Former banknote issuers of Hong Kong British overseas banks Indian companies established in 1853

History

Early years : 1853–1900

Transition years : 1900–1959

Amalgamation into HSBC and divestment : 1959–1987

See also

References