George Stephen Biography

(Scots-Quebecker Banker, Railway Executive in Canada and Businessman)

Birthday: June 5, 1829 (Gemini)

Born In: Dufftown, Scotland

George Stephen, 1st Baron Mount Stephen, was a well-known Canadian financier, railroad builder and philanthropist. Born into a working-class family in Scotland, he left school at fourteen and moved to Canada at twenty-one, where he initially worked for a cousin. Eventually he was able to establish himself as a successful businessman and by late 1860s became one of the foremost financiers in Montreal, working alongside the city's most prominent names. Elected first the Director and then the President of the Bank of Montreal, he successfully guided the establishment through 1870s' long depression. However, his attention soon turned to railroad and in 1881, he resigned from his post to concentrate full time on building the Canadian Pacific Railway, putting even his Montreal home as collateral to arrange the required finance. Also, a noted philanthropist, he donated $1 million to the City of Montreal to construct and maintain the Royal Victoria Hospital and over £1.3 million to the Prince of Wales Hospital Fund in London.

Quick Facts

British Celebrities Born In June, Canadian Celebrities Born In June

Also Known As: George Stephen, 1st Baron Mount Stephen, The Lord Mount Stephen

Died At Age: 92


Spouse/Ex-: Annie Charlotte Kane, Georgiana Mary Tufnell

father: William Stephen

mother: Elspet

Partner: Charlotte Annie Kane (1853–)

Born Country: Scotland

British Men Canadian Men

Died on: November 29, 1921

place of death: Brocket Hall, Hatfield, England

More Facts

education: parish school

Childhood & Early Years

Sir George Stephen was born on 5 June 1829, in a cottage built by his grandfather near Dufftown, a town in Banffshire, Scotland, well known for its whisky based economy. His father, William Stephen, was a carpenter, while his mother, Elspet Smith, was a crofter’s daughter.

Born eldest of his parents' eight children, he had at least two surviving sisters: Eleanora Simpson Cantlie and Elsie Stephen, as well as two surviving brothers: James Stephen and Francis Stephen. Nothing is known about the others.

When he was still a child, the family moved to Dufftown, where he played barefooted, running through fields to carry letters for the Duke of Richmond for a shilling. Concurrently, he attended the parish school of Mortlach.

Around the age of fourteen, George Stephen left school to serve first as a stable boy and later at a local hotel. A year later, he traveled to Aberdeen, where he lived for four years, serving as an apprentice to a draper and silk mercer.

In 1847, his father and sisters migrated to Montreal, Canada, while he, his brothers and mother stayed behind. In the following year, nineteen-year-old George Stephen traveled to London, where he initially worked for a draper and then at a wholesale dry goods house.

While working at the dry goods house, he was reunited with his cousin, William Stephen, who ran a wholesale dry goods business in Montreal. He invited George to join him. Sometime now, the rest of his family too immigrated to Canada.

In 1850, George Stephen followed his family to Montreal. There he began working at his cousin's establishment, remaining with it for the next twelve years, eventually inheriting the firm on William's death in 1862. 

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Successful Businessman

On acquiring his cousin's firm in 1862, George Stephen made his youngest brother, Francis, a partner in the business. By 1864, he was able to establish himself as a successful businessman, being elected to the Montreal Board of Trade in July that very year.

In 1866, he established a new firm, George Stephen and Company, which dealt mainly in manufacture and sale of woolen goods, concurrently serving as an agent for textile manufacturers. Also in the same year, he started working closely with his cousin, Donald Smith (future Lord Strathcona), later opening multiple ventures with him.

Also in 1866, he became a partner of the B. and W. Rosamond and Company, run by Bennett and William Rosamond, providing an important link to Montreal financial interests for their tweed mills in Almonte. However, control of the company rested in the hands of Bennett Rosamond.

In 1867, he sold his share at the dry good business to his brother Francis and his partner Andrew Robertson. In the following year, he and Donald Smith partnered with Richard B. Angus and Andrew Paton to run the Paton (Textile) Manufacturing Company of Sherbrooke, a woolen mill built by Andrew Paton.

In May 1869, he initiated the recapitalization of the Montreal Rolling Mills Company, inducting notable persons in its board. Under his guidance, the firm would eventually become a leading manufacturer of nails and iron bars in Montreal.

By 1870, he had started investing in railways, forming Canada Rolling Stock Company for that purpose. However, it would take few more years for him to get fully involved in it. Meanwhile in 1871, he became a partner in Sun Mutual Life Insurance Company of Montreal.

In 1872, he created the Canada Cotton Manufacturing Company, joining other notable industrialists in building mills in Cornwall, Ontario. Next in 1873, he was appointed the Director of the Bank of Montreal and served as its President from March 1876 until he resigned in 1881.

Although Canada suffered severe economic depression from 1873 to 1879 under his guidance Bank of Montreal was able maintain its position as the country's principal consumer and investment bank. During this period, he often had to travel to London and New York to meet leading financiers.

As the economic depression deepened, he became an advocate of higher tariffs for certain products. On the other hand, he also advocated duty exemptions for specialized equipment, including those needed in textile manufacturing or railway construction. By the late 1870s, he became increasingly close to the Conservatives.

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In 1877, George Stephen met James Jerome Hill, who ran steamboats on the Red River and was seeking to purchase unfinished line of the St Paul and Pacific Railroad in Minnesota and to finish it to the Canadian border. Inspired by its prospect, George Stephen decided to pitch in.

James Jerome Hill eventually formed George Stephen and Associates, with Stephen, his cousin Donald Smith, James Hill and Norman Wolfred Kittson as partners and Stephen as the company president. On March 13, 1878, agreement of transfer was signed and the line was bought for $ 5,500,000.

To secure finance Stephen and Hill had to pledge cash and collateral for their shares and secure short-term loan from the Bank of Montreal. It gave rise to rumor that George Stephen had used his position to secure the loans at preferred rate and with minimum collateral.  Stephen ignored such rumors.

Very quickly, George Stephen and Associates turned the railroad around, showing a profit of $500,000 in 1878 alone. In May 1879, the name was changed to St. Paul, Minneapolis and Manitoba Railway.

Canadian Pacific Railway

By the summer of 1880, George Stephen began to negotiate with the Government of Canada to secure the contact to build the Canadian Pacific railway. The contract was signed on 21 October 1880 and a new company called Canadian Pacific Railway (CPR) was incorporated on 16 February 1881, with Stephen as president.

Building the railroad was not an easy job. They not only had to negotiate a route across 2,000 miles of forests, swamps, rivers, and mountains, but also had to raise the necessary funds, amounting to $100 million.

Realizing the gravity of his new role and to dedicate himself to the railway, Stephen resigned from the board of the Bank of Montreal in 1881. By the year end, he had realized the magnitude of the task at hand and to raise the amount, he even put his Montreal home as collateral.

On November 7, 1885 at 9:22 AM, the last spike was driven into the Canadian Pacific Railway by Donald Smith, signaling the completion of the project. By then, most of the directors have left the company with only Stephen, Smith and Richard Bladworth Angus holding on to their nerves.

Later Years

George Stephen served as the President of CPR till 1888, remaining a director till 1893. However, from mid 1880s, he spent more time in England. Nonetheless, he continued to invest, acquiring Donald Smith Quebec Worsted Company in 1890 and, later, a Sherbrooke mill from the firm of Adam Lomas and Son.

Honors & Recognitions

In 1886, George Stephen was created a Baronet. Later in 1891, he was created 1st Baron Mount Stephen of Mount Stephen in the Province of British Columbia and Dominion of Canada, and of Dufftown in the County of Banff (Scotland). With that he became the first Canadian to be elevated to the Peerage of the United Kingdom.

In 1905, he was appointed a Knight Grand Cross of the Royal Victorian Order.

Personal Life & Legacy

On 8 April 1853, Stephen married his first wife, Annie Charlotte Kane, in London. The couple did not have any biological children, but had adopted a daughter called Alice Brooke. The first Lady Mount Stephen died in London on 10 April 1896.

In 1897, Stephen married his second wife Georgina Mary Tufnell. Popularly known as Gian, she had been Lady-in-Waiting to Princess Mary Adelaide, Duchess of Teck. This marriage produced no children.

George Stephen died at Welwyn, Hertfordshire, on November 29, 1921, at the age of 92.

In his private life, he was very fond of salmon fishing and bought several estates to facilitate his passion. 

George Stephen House, built at an estimated cost of $600,000 at 1430–1440 Drummond Street, Montreal, was later converted to a private club and became known as the Mount Stephen Club Building, Today, it is known as one of the most important heritage properties in Montreal.

Mount Stephen in the Rocky Mountains has been named after him.

See the events in life of George Stephen in Chronological Order

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