Ever since the early 18th century, Bombay was India's largest trading city and one of the largest ports of the eastern world. From there, cotton, spices, silk and raw materials of Indian subcontinent went out to the world. Naturally, it attracted energetic, hardworking persons having entrepreneurial skills.

Here in 1841, a trading company by the name of Khoja Mithabhai Nathoo was established. It was a family business trading in metals and other commodities which had clients both in India and abroad.

In 1891, a teenage boy joined the family business by the name of Habib Esmail who was to transform the company.

The business prospered and the family and the firm rapidly acquired a reputation for its fair dealing, honesty and trustworthiness.

Upcountry traders returning home, began to deposit their surplus cash with the company for safe keeping. From here to merchant banking was a natural progression as the company began to provide trading finance to its customers.

The young Habib was so successful that by the age of 18, he not only became a partner in the business but was also the President of 'Tamba Kanta Market' (metal market). His commercial skills, personal reputation and ever growing contacts moulded the company into a major trading firm.

When his four sons joined him in business, Habib Esmail established, 'Habib & Sons' in 1921 and changed the name of the family to 'Habib'.

Habib & Sons went on to become the flagship of the family and the parent of Habib Bank Limited.

His sons having learnt the quality of head and heart from their much loved father, became the motivating force in the family. Among his sons,  Mohammedali Habib showed exceptional quality of leadership and vision. He was to play a very important role in the Habib family and its growth and expansion as also in its social and charitable services to fellow Muslims and also in the new country to be formed - Pakistan.

As a child in school Habib excelled in studies and sport. However, a promising school career ended abruptly when his father died suddenly in 1891. At the tender age of 13 the young boy had to shoulder the responsibility of looking after his widowed mother and sister.

He joined his maternal Uncle Cassum Mohamed, the owner of Khoja Mithabhai Nathoo, merchant and manufacturers of copper and brass utensils established in the year 1841. The young Habib joined as an apprentice for six months without remuneration and his first pay was Rs5 per month only. The conscientious Habib worked day and night arriving before the opening of the shop and going home walking late at night to save bus and tram fare, unmindful of what he was paid, always doing something for nothing and following his uncle's advice of faithfulness, honesty, integrity and hard work. By the time he was 18, he became a partner in the firm of Khoja Mithabhai Nathoo and the president of the Copper and Brass Merchant Association.

Early success by God's grace gave him tremendous encouragement. He soon established his relationship with big and lucrative customers in Bombay, Karachi, Madras, Calcutta and Rangoon, and established two more shops in the bazaar and built several factories for manufacturing utensils.

Having captured over 60 per cent of the local utensil business, he concentrated on export and in addition to copper and brass utensils he got into iron scrap, manganese ore and cotton which he exported to East Africa, Italy, France, Great Britain and other European countries. He was so successful in iron scrap that he entered the ship breaking business and dismantled many ships, including S.S. Lindula, S.S. Paris and H.H. Highflier, a battle-ship.

Being a person of tremendous foresight, he sent his representative to Europe in 1912 and followed that up by establishing branch offices in Genoa and Vienna. Simultaneously, he began business relationship with Japan and   China importing hosiery, yarn, glassware and cutlery and exporting cotton.

The young Habib's reputation for honesty and fair play was so well known that his customers and local merchants in the market would leave their surplus funds with Habib for safe keeping and investment, thus the foundation of merchant banking was established for "House of Habib".

He started the firm "Habib & Sons" in 1921 and changed the family name to "Habib". His four sons namely Ahmed Habib, Dawood Habib, Mohammed Ali Habib and Ghulam Ali Habib joined him in the business. The firm expanded rapidly - banking remaining a core business.

At the age of 35 he commanded a worldwide organization and was ready to deal in anything that was legitimate and remunerative.

Habib Esmail died at a relatively young age of 53. He was an exceptional man. A firm believer in God with a conviction that one's prosperity should be shared with the less fortunate, which made his charitable.

His golden rules were: faithfulness, honesty, hard work, courage, humility, generosity and charity. He was able to instill these traditions in his sons and it is significant that these values continue to be followed by Habib's grandsons and great grandsons to this date.

The Habibs were close family friends of Mohammedali Jinnah, and soon after the Declaration of Lahore in 1940, demanding an independent Pakistan, Mohammedali Habib, with the full support of his brothers, particularly Dawood Habib, established the Habib Bank Limited in August 1941, as a Public Limited Company with a paid up capital of Rs2.5 million. In this way, he formalized the Habib merchant banking activities, paid tribute to the memory of their much loved father and created a landmark for the Muslims of India.

The Bank was organized from the very beginning on the principles of British banking tradition, with the main difference that the young and forceful Mohammedali Habib broke away from the dogma. It is said that when a British banker visiting Habib Bank Limited remarked on the absence of imposing leather bound ledgers, Mohammedali said "What is important is not the shape and size of the books but their contents".

The Bank filled a vacuum in banking in the subcontinent, playing a pivotal role of bringing the banking habit to the middle class masses in general and Muslims in particular. To open 34 branches in 5 years was to change the very pattern of branch banking in undivided India, where local banks preferred to restrict their activities to the province of their incorporation. It was all the more remarkable that this happened during and immediately after the Second World War and in the uncertain conditions of the pre-partition period.