Bank of Upper Canada

Bank of Upper Canada

Bank of Upper Canada, chartered 21 April 1821, commenced operations at York (Toronto) July 1822. It owed its origins to pressure from the commercial community, to close links with the Family Compact, and to the local government's hope that a bank would provide it with sorely needed capital. William Allan, president for 12 of the bank's first 13 years, adapted British banking theory to the reality of a capital-starved frontier and provided generally sound leadership. Thomas Gibbs Ridout, cashier (general manager) 1822-61, and William Proudfoot, Allan's successor (1835-61), were less successful.

During the Rebellions of 1837, the bank annoyed local commercial interests and, partly as a result, the Commercial Bank of the Midland District expanded more rapidly in the 1840s. During the 1850s, the bank held the government account, provided significant short-term capital for railway development and, in the boom years, recklessly speculated in land and railways. The bank never recovered from the 1857 economic collapse, losing the government account in 1864 and entering trusteeship in November 1866. Despite its great contribution to the development of Canadian commerce, it became a casualty of the very process it had helped facilitate: the transition from mercantilism to an industrial economy.