London City Airways started out as Eurocity Express. They were set up specially to operate out of London City Airport and started with two former New Zealand (Newmans Air?) Dash-7s - the Dash-7 was the only airliner certificated for LCY when it opened, due to the steep approach. The airline's name was changed before they took delivery of their own four Dash-7s.
Eurocity Express / London City Airways was set up by Michael Bishop and was part of the Airlines of Britain group, of which British Midland was at the time the largest component (others were Longanair and Manx Airlines). Main destinations served by London City Airways were Paris (in competition with Brymon operating on behalf of Air France), Amsterdam and Brussels. In later times, the also operated to Jersey once in a while.
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Photo © Andy Martin
The airline's tail colours were meant to represent a business suit, shirt and tie, which was felt appropriate for an airline operating out of the city airport and aimed at attracting business passengers.
London City Airways never did that much business themselves (London City Airport was VERY slow to take off in terms of passenger throughput) and eventually the Dash-7s were brought into British Midland's operation and indeed were painted in British Midland colours.
The Dash-7 would never have been particularly competitive when operated against jets as it wasn't particularly fast and it was quite expensive to operate. Once the BAe146 was certificated for the steep approach into London City Airport, and other airlines started operating the type, British Midland's LCY operations were gradually wound down and then closed. When Brymon teamed up with Air France, the Paris route became tough, Brussels didn't do particularly well anytime and Amsterdam was (if I remember correctly) the last to go.