Contrary to the name, French toast was not invented in France, in fact, it was invented before there was a France.
Bread has been a staple food for most cultures since food first began being prepared. Soaking bread was a way to make stale bread a bit more palatable, like gravy bread, bread pudding, and other recipes. Soaking stale bread in milk and egg and then cooking it is just another variation of the theme.
The earliest reference for 'French' bread dates back to 4th century Rome. Romans would take bread and soak it in a milk and egg mixture and cook it, typically frying it in oil or butter, much as it is still prepared.