THE HEART OF THE CITY

BANK OF HAMILTON

80 King Street East
(pre-1890 address 37 King Street East )

CURRENT STATUS (1999)

BUILDING INFORMATION
Date Built: 1890
Original Owner: Gore Bank
Original Use: Bank of Hamilton
Subsequent Uses: Same

ARCHITECTURE
Size: Three-storey (1890), 1905-1907 foundation strengthened to support enlarged structure (seven–storeys)
Design and Style: Italian Renaissance Revival
Architect, Builder: Richard Waite, Buffalo (architect of original building); Charles Mills, Hamilton (1907 addition)
Construction Materials: Connecticut brow stone
Main Architectural Feature: N/A

The McInnes Bros. and the Bank of Hamilton were located in the same building which would later house the Post Office.

Banks were extremely important to cities in the early 1800s. They depended on them for stature and identity. One of the most prominent and successful banks in Hamilton’s history was the Bank of Hamilton.

In November 1871, a notice appeared in the Hamilton Spectator for a petition to approve an Act in Parliament that would incorporate the Bank of Hamilton. This activity was taking place only two years after Hamilton’s last major financial institution, the Gore Bank, had been taken over by the Canadian Bank of Commerce. However, the move to create a new bank made sense. Hamilton’s business was booming and that created a need for money, as well as a need to manage that money. There were many attempts to get a local bank going after the Gore bank closed; however, the Bank of Hamilton was the only one to become incorporated.

The bank’s success can be attributed to its sponsors and owners. The men who became involved in the Bank of Hamilton were the most prominent members of Hamilton’s business community. Additionally, two former Gore Bank directors were involved with running the new Bank of Hamilton, enabling the present bank owners to foresee similar problems and prevent them from happening again.

The Bank of Hamilton’s beginning was rapid and unstable.  The bank started service quality, only two months after the charter was received. When the stock books were opened to the public for the first time on July 6, 1872, it only took two hours for over $2,000,000 worth of subscriptions to be made. By August of 1872, the first shareholders meeting was held, and seven directors were elected. This list read like a who’s who of Hamilton business. Donald McInnes was elected as the bank’s first President and John Stuart was made Vice-President. By the end of the month, the Bank of Hamilton was opened for business.

Over the next year the bank operated efficiently yet cautiously. It started small with no branches aside from the main branch, so that the owners could keep a close eye on things. This method paid off. By the first annual shareholders meeting on June 12th 1873, the owners reported a profit of $23, 951.27. The shareholders were impressed and re-elected the directors. The caution shown by the directors also served the bank well in a financial crisis, which occurred from 1873-1879. While many businesses struggled during this time, the Bank of Hamilton remained stable, and in some ways managed to prosper. By 1875 only 25% of the shareholders were from Hamilton. This local bank was receiving support from a large area. In fact, most of the bank’s stockholders came from Toronto and Montreal, the country’s business capitals. In light of the bank’s good fortune, branches were finally opened.

The Bank of Hamilton did run into some problems during the crisis. In the summer of 1879 six banks in the area had to suspend activities due to financial difficulties. Soon after, on August 1st 1879, the McInnes Block burned down and the bank’s head office was destroyed. The public knew of the connection between the bank and McInnes, and after seeing so many other banks succumb to the financial difficulties of the time, they began to pull out their deposits. But the bank assured the public that the vaults were untouched in the fire and that McInnes’ account was with a different firm, so the people’s deposits would not go to cover his loss. The bank quickly recovered public confidence. They moved their location to the old Bank of Montreal building at 17-19 King St. West. Once past this crisis, the bank once again prospered. The economy was on the upswing and the President, Donald McInnes, was called to the Senate. He resigned as president and was succeeded by John Stuart.

In 1887, the bank’s directors purchased a lot at the corner of King and James. By the 1890s, it was near completion. The architect was Richard White, who had designed hundreds of major buildings in the area, including the Ontario Legislature and the Canada Life Assurance Building. Bank buildings in Hamilton were traditionally examples of exceptional architectural skill and the new Bank of Hamilton building was no different. The building sat on the South West corner of King and James and faced Gore Park. The style was Italian Renaissance with a beautiful entrance made of mahogany doors. The banking room had a 35-foot ceiling made of marble with golden panels and sea-green ornamentation. There had never before been anything as artistic as this ceiling in any Canadian structure. The design was innovative as well. Instead of brass wickerwork between the teller and the customer, as was normal for the time, there was an exceedingly wide counter. The counter was 69 inches wide and had a wave top, which means it was elevated 3 inches in the centre so that a small shove would send paper money from teller to customer. Off the banking room there were many offices, the president’s room, the cashier’s office and private apartment, and a room exclusively for women. A beautiful staircase led to the vaults and many other offices. The final effect of this building was called "superb."

The Bank of Hamilton played a key role in developing Hamilton’s industry. In the 1890s the bank underwrote the Cataract Power Project which brought cheap hydro to the city. This proved to be a great incentive to industry. New industries like the Canada Screw Co., the Hamilton Blast Furnace Co., and the Ontario Rolling Mill Co. established Hamilton as Ontario’s steel-making centre.

The bank’s conservative methods helped it last through the depression from 1893-1896. On July 29, 1896 the Bank of Hamilton’s first Winnipeg branch opened. This was the first branch outside Hamilton’s surrounding area that was easily accessible by railway. The West was becoming the best potential market for Hamilton’s products, especially its industry, and the bank was hoped to provide the financial link. By December 1898, six more branches were opened in Manitoba. This marked the beginning of two decades of explosive growth in the West. Branches were being set up so quickly that they were servicing out of tents, not even waiting long enough to erect a building. When the bank established a branch in Vancouver, it gained a 3000 mile reach across the country. The national character of Hamilton’s branch brought a great deal of civic pride. As the Hamilton Spectator reported on January 15, 1919; "[with so many branches across the country] the name of our city is carried to all parts of the country, a synonym of stability and growth."

In June 1903, the Bank of Hamilton elected its third president. John Stuart resigned after 22 years and was succeeded by William Gibson. Although new faces were appearing and old ones leaving, members of the board of directors always remained tied to Hamilton business.

Profits were high by 1905 and the bank decided to increase the size of its head office. Eight stories were added, creating Hamilton’s first "sky scraper."  This tall building attracted the attention of Harry H. Gardiner of Washington, known as the Human Fly.  He climbed the Bank of Hamilton building on November 11, 1918, to celebrate the end of World War I.  He had been climbing buildings for 13 years and had successfully climbed over 700 buildings in Europe and North America.  While climbing the side of the building, Gardiner stuck his head into one of the open windows and signed some insurance papers.  He also purchased a $1,000 bond.  The 47-year-old professional Fly admitted that he had to try for insurance at the Bank of Hamilton because it had so far been impossible for him to gain insurance elsewhere, since he was considered a high risk.   This spectacle brought much attention to the Bank of Hamilton. 

The boom of high profits also allowed the bank to try some new innovations. It was the first bank to establish an employee group life insurance policy. Also, it began the first women only branch, located at James and Merrick Streets in Hamilton.

By the end of World War I, the bank had achieved national character and more non-Hamiltonians were elected to the board of directors. In the summer of 1915, the Royal Bank offered a merger that was met favourably by the directors. By the middle of August however, the merger offer was dead. The public had reacted strongly against the merger, since the Bank of Hamilton had strong ties to Toronto and the Royal Bank was based in Montreal. Also, Finance Minister, Sir Thomas White, disallowed the merger saying it was not in the best interest of the country to reduce the number of banks. But the Bank of Hamilton’s policy makers were beginning to look strongly towards a merger because they were frightened by losses they were facing in the West. The Bank of Hamilton was not the only financial institution to go west. Many others had had the same idea. Eventually, there were just too many banks in the West and several branches had to close up. The Bank of Hamilton had never experienced loss before and the directors were beginning to make panic decisions.

By the annual meeting in 1921 the crash had arrived, or so it seemed, perhaps only because the bank had never really known disaster previously. But by 1922, the directors reported serious loss in business. The post-war economy had dried up, there was no more demand for loans and accounts shrank. All this coincided with the bank’s 50th anniversary. Numerous branches had to be closed. At the 1923 annual meeting, Sir John said, "our profits have been less and our losses have been larger." A further blow to the company came when Sir John Hendrie died that same year. Furthermore, western grain prices were low and the bank became concerned about the millions of dollars that was tied up there. Finally, on August 17, 1923, the Home Bank of Toronto crashed and public confidence reached an all-time low.

A Hamilton Spectator headline on March 24, 1923 read: "Bank’s Position is Sound Despite Difficult Times." But only five months later the Spectator’s headlines read much differently: "Bank of Hamilton Merges with Strong Institution." The bank planned a merger with the Canadian Bank of Commerce. The minister of finance approved this merger, where he did not approve the other, because the Bank of Hamilton and the Canadian Bank of Commerce were only in competition in 40 of the 130 cities they were located. The merger made sense from a business point of view, but civic pride was threatened. By September 10, the terms of the merger had been drawn up. The terms included a share for share exchange and openings on the Canadian Bank of Commerce board of directors for members from the Bank of Hamilton. The terms were approved unanimously by the shareholders on November 19, 1923 and by December 31, the Bank of Hamilton ceased to exist. On January 3, 1924, the bank opened its doors as the Canadian Bank of Commerce (Bank of Hamilton division).

The Hamilton headquarters was western Ontario’s head office until 1962 when they moved to London. A large brass plate remained on the corner of King and James until the building was remodeled in the 1950s. The Bank of Hamilton played an enormous role in building the city, since without it the industry never could have flourished. And although the Bank of Hamilton lost its name to the Canadian Bank of Commerce, most of its members and procedures remained the same. As J.P. Bell, the bank’s Manager-in-Chief at the time of the merger said: "The Commerce made us all members of the family… It was a wedding, - not a funeral."

REFERENCES:
Ames, John H. The Bank of Hamilton 1872 – 1923. Special Collections, HPL.
Bank of Hamilton Scrapbook. Special Collections, HPL.
Clipping File – Hamilton – Real Estate – King and James Streets.   Special Collections, HPL.
Herald Scrapbook. Volume B1. Special Collections, HPL.
Herald, November 12, 1918. Special Collections, HPL.
Historic Houses Scrapbook. Volume 5. Special Collections, HPL.
Magazine of Industry and Daily Times. Special Collections, HPL.
The Head-of-the-Lake Historical Society Wentworth Bygones 1988. Volume 15. Special Collections, HPL.
Trigge, A. St. L., History of the Canadian Bank of Commerce. Volume 3. The Canadian Bank of Commerce. 1934.