Royal Bank of Scotland

The Royal Bank of Scotland (RBS) is a major retail and commercial bank founded in 1727 as a corporation by royal charter in Edinburgh, Scotland. The establishment of RBS began when investors of the failed "Company of Scotland" formed the Equivalent Society, which wanted to go into the banking industry. The British government agreed, as it saw the Old Bank of Scotland as a sympathizer of the Jacobites, supporters of King James VII of Scotland and II of England. RBS was the second bank established in Scotland, the first being the Bank of Scotland, founded in 1695.

As early as 1728, RBS invented the concept of an overdraft when it allowed a merchant of the day to access £1,000 worth of credit. While this was a large amount of money for the time, it paved the way for the modern overdraft. In 1820, RBS moved from its original branch to the new town of Glasgow and remained there until 1910.

The bank had opened six other branches and acquired others following the collapse of the Western Bank of Scotland in 1857 and the City of Glasgow Bank in 1878. RBS acquired Dundee Banking Co in 1864 and opened a branch in the City of London in 1874. By 1910, the bank had 158 branches and 900 staff.

During World War I, the volume in the banking business grew, and the Royal Bank acquired Myers Drummond of London in 1924, Williams Deacon's Bank in 1930, and Glyn, Mills & Co in 1939. In 1969, the RBS merged with National Commercial Bank of Scotland. Later, after World War II, RBS opened its own college to train new employees to use new machines and learn about the financial world.

During the 1960s and '70s, the National Commercial Bank merged with RBS and by 1971, restrictions on Scottish banks operating in England were lifted. The bank then operated out of offices in America and Hong Kong, and by the end of the 1970s, RBS was known as the Royal Bank of Scotland Group plc.

The RBS continued to grow and played a leading role in lending to businesses serving the North Sea oil and gas industry. In 1982, the RBS acquired Lockerbie Savings Bank and three years later, acquired Annan Savings Bank.

The biggest takeover in RBS history took place in 2000, when they took over National Westminster Bank plc, originally one of the big five banks. In 2005, RBS opened a new state-of-the-art headquarters in Edinburgh that included a nursery for employee children and fitness facilities. And two years later, before the financial crisis of 2007, RBS acquired ABN Amro, a Dutch bank.