It was established on 1 July 1843 through the amalgamation of a number of existing regional banks and headquartered in Madras (now Chennai).

In 1683, Governor William Gyfford (1681–1687) and his Council in Madras established a bank.

Bank of Madras had a branch network spread into all the major cities and trade centers of South India, including Bangalore, Coimbatore, Madurai, Mangalore, Calicut, Tellicherry, Cochin, Alleppy, Cocanada, Guntur, Masulipatnam, Ootacamund, Nagapatnam, and Tuticorin.

These included managing the banking business of the Presidency of Madras and offices of the colonial government of India located in South India, and managing the Public Debt Office of the Government of Madras.

The site was acquired for ₹ 100,000 in 1895, building was designed by Col. Samuel Jacob, and suitably modified and adapted by Henry Irwin (1841–1922), and constructed by Namperumal Chetty, a reputed builder, for ₹ 300,000.