The First Bank in the World, Banca Monte dei Paschi in Italy

In early history, banks were groups of merchants who provided grain loans to farmers and merchants who carried goods.

From Sumer, then developed in Ancient Greece and the Roman Empire. Where the bank is a lending institution located in a temple, accepts deposits, and exchanges money.

Reporting from the Britannica Encyclopaedia, many historical records state that there was a high development of the banking system in Italy in the Middle Ages.

The most famous Italian bank is the Medici bank, which was founded by Giovanni Medici in 1397. It is the oldest bank and is still operating today under the name

Banca Monte dei Paschi, headquartered in Siena, Italy.

History

Monte dei Paschi or previously Medici di Siena is the oldest bank in the world, dating back to 1472 as Monte Pio (pawning agent) by order of the Magistrate of the Republic of Siena.

Banks were expressly established to provide assistance to the underprivileged classes of society, who are experiencing difficulties in the economic field.

The development of this bank is very rapid, continuing the commercial and banking traditions of the City of Siena. Despite carrying the classical system, the Medici showed their activeness, especially after the reforms of 1568 and 1624.

By 1624, the Medici's performance was advancing and getting closer to the economy in the remote regions of Italy. As a result of these reforms, the bank changed its name to Monte dei Paschi, which is still known today.

Monte dei Paschi gradually expanded its activities to the greater and wider territory of Tuscany. The bank is the most solid bank in Italy and started doing new activities such as land loans for the first time in Italy.

In 1907-1930, this bank expanded its reach beyond national borders, such as in Empoli, Florence, Perugia, Naples, and Rome. In addition, he also participated in the establishment of Banca Toscana.

Entering 2000-2005 with its debut on the stock exchange, the bank began an intense phase of territorial and operative expansion, marked by the following major developments:

Acquisition of participation in several regional banks.

Strengthening production structure in strategic market segments through product company development.

Commercial productivity development, with the aim of increasing the level of assistance and consultation to investors and businesses.

Consolidation of activities in certain areas of strategic importance, such as the private banking market, and, following the pension reform, private pension plans.

Implementation of a major program of opening new branches of the Group, with the goal of a network of more than 2,000 branches by the end of 2006.

In 2009-2013 this bank had to lose billions of euros in customer funds due to derivative losses suffered by this bank amounting to 73 million euros. However, at this time the bank is still operating.

Reference :

https://www.kompas.com/skola/read/2020/07/05/170653369