DUNCAN, DAVID HUNTER, banker; b. 6 Jan. 1843 in Brechin, Scotland; m. 1878 Amy L. Taylor of New Scone, Scotland, and they had two daughters; d. 1 April 1903 in Halifax.

After graduating from Arbroath Academy in Arbroath, Scotland, in 1860, David Hunter Duncan joined the Royal Bank of Scotland there. The Scottish banking system was then changing rapidly, and at the heart of this change was the creation of a corps of mobile, uniformly trained personnel. The diligent employee acquired banking skills by means of along and often poorly paid clerkship and could then progress through the rank of teller to that of accountant; a select few would achieve a position as cashier (general manager) of a bank. Duncan’s career would follow this pattern of development, which was spreading to banking systems outside Scotland. He joined the London and County Bank in London in 1863. Six years later he accepted a position with the London-controlled Bank of British North America, which posted him in turn to Halifax, Saint John, N.B., and New York.

On 25 Aug. 1872 Duncan became the accountant at the Merchants’ Bank of Halifax, with an annual salary of $1,600. The Merchants’ was a small provincial bank with assets of $2.3 million and a fledgling network of branches in towns such as Truro, Pictou, and Bridgewater. Founded in 1864 as a private bank by a group of Haligonian merchants which included Edward Kenny*, it had acquired a federal charter in 1869. Its initial growth was precarious, vulnerable to commercial downturns and imperfect banking procedures. The dangers of inadequate supervision were no better illustrated than on 17 Nov. 1882 when the directors learned to their horror that the senior officer, cashier George Maclean, “was a defaulter to the Bank to the extent of $10,729.18.” Maclean was summarily dismissed and Duncan appointed his successor at a salary of $4,000 a year.

Duncan’s cashiership saw the Merchants’ Bank emerge cautiously onto the national and international scene. Central to this expansion was his insistence that relations between the head office and branches be governed by an adherence to regular procedures. For instance, rigorous and frequent inspections of branches were instituted in order to minimize defalcations by staff and bad debts, and agents were required to have loans approved by the head office. Working closely with president Thomas Edward Kenny, Duncan oversaw the bank’s shift away from the increasingly limited potential of Halifax and its hinterland. From 1873, beginning with Charlottetown, branches were started in the other Maritime provinces, and movement into Quebec (Montreal, 1887) allowed the bank to penetrate the more dynamic mercantile and industrial markets of central Canada. Tapping Montreal’s transcontinental commercial arteries, the bank also opened branches in British Columbia (Vancouver and Rossland, 1897) and Ontario (Ottawa, 1899). In 1895, as a result of the bank crash in Newfoundland [see James Goodfellow*], a branch was opened in St John’s.

Internationally the bank followed the Maritimes’ oceanic trade. In 1881 Duncan started a correspondent account with the Bank of Scotland in London in order to facilitate foreign exchange and the placing of Canadian securities and loans. Branches were established in Bermuda (1884) and Saint-Pierre and Miquelon (1886), and in 1899 an agency was started in New York and a branch in Havana in order to take advantage of the opportunities which arose in the aftermath of the Spanish-American War. By the time Duncan retired the bank had 42 branches, 30 more than when he entered its service.

Under Duncan’s management, the Merchants’ assets grew from $3.7 million in 1882 to $17.1 million in 1899, and its paid-up capital increased during the same period from $797,000 to almost $2 million. Throughout this expansion, Duncan anchored the bank with his adherence to the principles of Scottish banking. He was passionately devoted to building up the bank’s reserve fund, an all-important insurance against bad debts, and it grew from $180,000 to $1.7 million during his cashiership. He also ensured that the staff of the bank, which rose from 36 in 1882 to 215 in 1899, was drilled, by means of circulars and standardized rules and regulations, in the rudiments of branch banking, such as foreign exchange, bills of exchange, and commercial loans. When, in the 1890s, the bank began trying to attract more daily banking business from individuals, its employees were given a thorough grounding in the principles of retail banking as well. Above all, Duncan recruited competent young men, and to them he held up his own career as a model of the success that diligence and integrity could bring. New employees, he instructed the Montreal branch in 1887, should have impressed upon them “the strong necessity of becoming something more than a capable teller.”

Duncan’s most important recruit, and his successor, was Edson Loy Pease*, who came from the Canadian Bank of Commerce as an accountant in 1883. Pease’s expansionist vision was largely responsible for the bank’s jumps to Montreal, New York, and Havana. Duncan counselled Pease in these moves and made him the first manager of the crucial Montreal branch. But he also occasionally tempered the pace of Pease’s initiatives, conscious that the bank’s directors were wary of allowing it to push too far from its Maritime roots. “I have to request,” he typically advised Pease in 1888, “that you will continue your cautious policy, and not be anxious to do too much.”

Pease’s success in Montreal and the consequent expansion of business eventually led the directors to recognize that some decentralization was necessary if the bank was to take full advantage of the enlarged scope of its operations. In February 1899 they made Duncan and Pease joint general managers; Pease was to oversee the Montreal, western Canadian, and Caribbean operations, Duncan the Maritime branches and the head office. The same year, however, it became clear even to the bank’s conservative directors that the future lay with Pease’s expansionism rather than with Duncan’s more cautious policies. On 31 December Duncan retired on a generous yearly pension of $4,000; a testimonial honouring his contribution to the bank was signed by 177 employees. Drawn by nostalgia, he retired to his native land, but he soon came back to Halifax, where he died in 1903. The Merchants’ became the Royal Bank of Canada in 1901, and six years later moved its head office to Montreal.

Courteous, self-effacing, and correct in his manner, Duncan seldom holidayed, relaxing instead over five-cent poker and a weekly game of golf. A member of the Halifax Club (at which he socialized with other prominent citizens such as William Stevens Fielding) and a regular attender of St Matthew’s Presbyterian Church, he served as vice-president of the Canadian Bankers’ Association in 1894. An important transitional figure in Canadian banking, Duncan helped lay the foundation of what would become by the mid 1920s Canada’s largest bank in an industry steeped in Scottish banking tradition and shaped by Canadian geography.

Duncan McDowall