SCOTLAND'S oldest bank is celebrating its 320th birthday.

The Bank of Scotland, founded by an Act of the Scottish Parliament on 17 July 1695, reaches the milestone today.

Post-dating the Bank of England by just one year, the BoS was primarily set up to develop Scotland’s trade with England and the Low Counties, and began business in February 1696 with a working capital of £120,000 Scots, which is just £10,000 in today’s money.

Famous customers of the past include Henry Raeburn, Thomas Telford, Walter Scott, Thomas Carlyle, Robert Stevenson and Mrs Robert Burns.

The very first record of Bank of Scotland providing a loan to a customer appears in the minutes of 13 Apr 1696, mentioning that the directors approved a loan of £500 to the Earl of Strathmore secured by a 'pledge of silver plate' to the value of £600.

The bank opened its first branch offices in Dumfries and Kelso in 1774. Evidence suggests Dumfries was first branch to be operational, with the first account approved on 26 Sep 1774.

But it was not all plain sailing. In 1826 bank manager George Morgan was killed in a duel with customer David Landale, after the two quarrelled over Landale’s credit worthiness.

Landale later stood trial for murder but was acquitted on grounds of self-defence, in what was the last duel fought in Scotland.

In 1959 it was the first bank in the UK to introduce computers for centralised accounting, and introduced its first cash machine 'Scotcash' in 1968.

The machines operated 24 hours a day and proved so popular that there were 26 in operation by 1971.

Mike Moran, Director at Bank of Scotland said, “A lot has changed since 1695, but building relationships with our customers and helping them make the right decisions, both big and small, is just as important to us today as it was right at the very beginning. "Our focus on serving the needs of the people, communities and businesses of Scotland is stronger than ever. We are Scotland’s relationship bank, part of the fabric of everyday life, and we’re very proud of how far we’ve come."