First National Bank (South Africa)
Encyclopedia
First National Bank is one of South Africa
's "big four" banks. It is part of First Rand Limited
, which trades on the JSE
. FNB also has subsidiaries in Swaziland
, Mozambique
, Botswana
and Namibia
, which are all listed on their countries' respective stock exchanges. In January 2009, First National Bank received authorization from the Bank of Zambia
to begin banking operations in Zambia
. FNB, in a statement, said that their Zambian operations would start during the second quarter of 2009.
in 1838, due to wool export boom in the district. By 1874, the bank had four 4 branches - at Grahamstown, Middelburg
, Cradock
and Queenstown
.
Due to a recession the bank was bought out in 1874 by the Oriental Bank Corporation
(OBC). However, as a result of financial difficulties that the Oriental Bank Corporation was experiencing in India, it decided to withdraw from South Africa and thus the Bank of Africa was formed in 1879 to take over the OBC's business in South Africa.
During the same period the government of the South African Republic
desired to create a local commercial bank, due to the discovery of gold in Barberton
and the Witwatersrand
. The government thus created a bank through a concession agreement. The task of the bank was to focus primarily one financial agricultural development, but a state mint was also established as part of the concession. The Nationale Bank der Zuid-Afrikaansche Republiek Beperk (National Bank of the South African Republic Limited) was registered in Pretoria in 1891 and opened its doors for business on 5 April of the same year. After the conclusion of the Second Anglo-Boer War in 1902, the name of this bank was changed to the National Bank of South Africa Limited.
Due to another recession, the Bank of Africa was bought out by the National Bank in 1912, Another bank, the National Bank of the Orange River Colony had already been bought out in 1910. The Natal Bank, which was founded in 1854 to fund the Natal Colony's sugar
industry, also suffered financial difficulties and was taken over in 1914. The National Bank was now one of the strongest banks in South Africa.
However, by the early 1920s, the National Bank was suffering from bad debt and heavy losses. It consequently merged with the Anglo-Egyptian Bank and the Colonial Bank in 1925 to form Barclays Bank (Dominion, Colonial and Overseas). In 1971 Barclays restructured its operation and its South Africa operation was renamed Barclays National Bank Limited.
However, due to a disinvestment
campaign against South Africa because of its apartheid policies, Barclays was forced to reduce its shareholding and sold its remaining shareholding in the bank in 1986. The bank was renamed "First National Bank of Southern Africa Limited" in 1987 and became a wholly South African owned and controlled entity.
In 1998 the financial services interests (which included their shareholding in First National Bank) of Rand Merchant Bank Holdings and Anglo-American Corporation were merged to form First Rand Limited, which is listed on the JSE Securities Exchange. In consequence, FNB became a wholly owned subsidiary of First Rand Limited; it currently trades as a division of FirstRand Bank Limited. FNB also has subsidiaries in Swaziland, Botswana, Namibia, Lesotho and Zambia, which are all listed on their country's respective stock exchange
s.
South Africa
The Republic of South Africa is a country in southern Africa. Located at the southern tip of Africa, it is divided into nine provinces, with of coastline on the Atlantic and Indian oceans...
's "big four" banks. It is part of First Rand Limited
First Rand Limited
First Rand Limited , also referred to as First Rand Group or as FirstRand Bank, is a financial services provider in South Africa. The group has its headquarters in Johannesburg, South Africa, with subsidiaries in five neighboring Southern African countries, as well as in India...
, which trades on the JSE
Johannesburg Securities Exchange
JSE Limited is the largest stock exchange in Africa. It is situated at the corner of Maude Street and Gwen Lane in Sandton, Johannesburg, South Africa...
. FNB also has subsidiaries in Swaziland
Swaziland
Swaziland, officially the Kingdom of Swaziland , and sometimes called Ngwane or Swatini, is a landlocked country in Southern Africa, bordered to the north, south and west by South Africa, and to the east by Mozambique...
, Mozambique
Mozambique
Mozambique, officially the Republic of Mozambique , is a country in southeastern Africa bordered by the Indian Ocean to the east, Tanzania to the north, Malawi and Zambia to the northwest, Zimbabwe to the west and Swaziland and South Africa to the southwest...
, Botswana
Botswana
Botswana, officially the Republic of Botswana , is a landlocked country located in Southern Africa. The citizens are referred to as "Batswana" . Formerly the British protectorate of Bechuanaland, Botswana adopted its new name after becoming independent within the Commonwealth on 30 September 1966...
and Namibia
Namibia
Namibia, officially the Republic of Namibia , is a country in southern Africa whose western border is the Atlantic Ocean. It shares land borders with Angola and Zambia to the north, Botswana to the east and South Africa to the south and east. It gained independence from South Africa on 21 March...
, which are all listed on their countries' respective stock exchanges. In January 2009, First National Bank received authorization from the Bank of Zambia
Bank of Zambia
The Bank of Zambia is the central bank of Zambia. According to its website, the principal responsibility of the bank is to create and implement monetary policy that will maintain the economic stability of the country.The bank's offices are located in Lusaka....
to begin banking operations in Zambia
Zambia
Zambia , officially the Republic of Zambia, is a landlocked country in Southern Africa. The neighbouring countries are the Democratic Republic of the Congo to the north, Tanzania to the north-east, Malawi to the east, Mozambique, Zimbabwe, Botswana and Namibia to the south, and Angola to the west....
. FNB, in a statement, said that their Zambian operations would start during the second quarter of 2009.
History
FNB claims to be South Africa's oldest bank and officially traces its origins back to the Eastern Province Bank, which was formed in GrahamstownGrahamstown
Grahamstown is a city in the Eastern Cape Province of the Republic of South Africa and is the seat of the Makana municipality. The population of greater Grahamstown, as of 2003, was 124,758. The population of the surrounding areas, including the actual city was 41,799 of which 77.4% were black,...
in 1838, due to wool export boom in the district. By 1874, the bank had four 4 branches - at Grahamstown, Middelburg
Middelburg, Eastern Cape
Middelburg is a town in the Eastern Cape province of South Africa, in the Great Karoo. It lies in the Upper Karoo, 1 279 m above sea level, with a population of 44000...
, Cradock
Cradock, Eastern Cape
Cradock is a town in the Eastern Cape Province of South Africa, in the upper valley of the Great Fish River, by rail northeast of Port Elizabeth. The town is the administrative seat of the Inxuba Yethemba Local Municipality in the Chris Hani District of the Eastern Cape. The estimated population...
and Queenstown
Queenstown, Eastern Cape
Queenstown, named after Queen Victoria, is a town in the middle of the Eastern Cape Province of South Africa, roughly half way in between the towns of Cathcart and Sterkstroom. It is currently the commercial, administrative, and educational centre of the prosperous surrounding farming district...
.
Due to a recession the bank was bought out in 1874 by the Oriental Bank Corporation
Oriental Bank Corporation
The Oriental Bank Corporation was a bank in India in the 19th century. It was also the first bank in Hong Kong and the first bank to issue banknotes in Hong Kong....
(OBC). However, as a result of financial difficulties that the Oriental Bank Corporation was experiencing in India, it decided to withdraw from South Africa and thus the Bank of Africa was formed in 1879 to take over the OBC's business in South Africa.
During the same period the government of the South African Republic
South African Republic
The South African Republic , often informally known as the Transvaal Republic, was an independent Boer-ruled country in Southern Africa during the second half of the 19th century. Not to be confused with the present-day Republic of South Africa, it occupied the area later known as the South African...
desired to create a local commercial bank, due to the discovery of gold in Barberton
Barberton, Mpumalanga
Barberton is a town in the Mpumalanga province of South Africa, which has its origin in the 1880s gold rush in the region. It is situated in the De Kaap Valley and is fringed by the Mkhonjwa Mountains...
and the Witwatersrand
Witwatersrand
The Witwatersrand is a low, sedimentary range of hills, at an elevation of 1700–1800 metres above sea-level, which runs in an east-west direction through Gauteng in South Africa. The word in Afrikaans means "the ridge of white waters". Geologically it is complex, but the principal formations...
. The government thus created a bank through a concession agreement. The task of the bank was to focus primarily one financial agricultural development, but a state mint was also established as part of the concession. The Nationale Bank der Zuid-Afrikaansche Republiek Beperk (National Bank of the South African Republic Limited) was registered in Pretoria in 1891 and opened its doors for business on 5 April of the same year. After the conclusion of the Second Anglo-Boer War in 1902, the name of this bank was changed to the National Bank of South Africa Limited.
Due to another recession, the Bank of Africa was bought out by the National Bank in 1912, Another bank, the National Bank of the Orange River Colony had already been bought out in 1910. The Natal Bank, which was founded in 1854 to fund the Natal Colony's sugar
Sugar
Sugar is a class of edible crystalline carbohydrates, mainly sucrose, lactose, and fructose, characterized by a sweet flavor.Sucrose in its refined form primarily comes from sugar cane and sugar beet...
industry, also suffered financial difficulties and was taken over in 1914. The National Bank was now one of the strongest banks in South Africa.
However, by the early 1920s, the National Bank was suffering from bad debt and heavy losses. It consequently merged with the Anglo-Egyptian Bank and the Colonial Bank in 1925 to form Barclays Bank (Dominion, Colonial and Overseas). In 1971 Barclays restructured its operation and its South Africa operation was renamed Barclays National Bank Limited.
However, due to a disinvestment
Disinvestment
Disinvestment, sometimes referred to as divestment, refers to the use of a concerted economic boycott, with specific emphasis on liquidating stock, to pressure a government, industry, or company towards a change in policy, or in the case of governments, even regime change...
campaign against South Africa because of its apartheid policies, Barclays was forced to reduce its shareholding and sold its remaining shareholding in the bank in 1986. The bank was renamed "First National Bank of Southern Africa Limited" in 1987 and became a wholly South African owned and controlled entity.
In 1998 the financial services interests (which included their shareholding in First National Bank) of Rand Merchant Bank Holdings and Anglo-American Corporation were merged to form First Rand Limited, which is listed on the JSE Securities Exchange. In consequence, FNB became a wholly owned subsidiary of First Rand Limited; it currently trades as a division of FirstRand Bank Limited. FNB also has subsidiaries in Swaziland, Botswana, Namibia, Lesotho and Zambia, which are all listed on their country's respective stock exchange
Stock exchange
A stock exchange is an entity that provides services for stock brokers and traders to trade stocks, bonds, and other securities. Stock exchanges also provide facilities for issue and redemption of securities and other financial instruments, and capital events including the payment of income and...
s.