Banco slip

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Wiener Stadt Banco note for 25 guilders from July 1, 1762
50 guilders banco slip, 1806

The first banknotes in Germany and Austria were called banco slips . in Switzerland, the first banknotes were called zeddel .

General

While the paper money introduced in 1024 was gradually abolished in China, its introduction began in Europe. Paper money was first issued in Spain for the scarce metal coins in 1483, followed by Sweden on July 16, 1661 and England in 1694. Here it was the central banks that were authorized to issue paper money. Therefore, the term central bank can be traced back to its privilege to issue banknotes. Germany (1706) was followed by France in 1716 and, from July 1, 1762, Austria, where they were also known as bank notes.

Germany

The establishment of the “ Banco di gyro d'affrancatione ” was proposed on March 2, 1705 by Elector Johann Wilhelm II (popularly known as Jan Willem ). The word "affrancation" stood for debt relief or loan repayment . The bank was intended to "remedy the financial embarrassment caused by the war and to satisfy the many creditors". He determined that the deposit and note bank should have its seat in the "Heylig Roman Empire freyer instead of Cöllen". The estates provided the equity. The pompous Wellem wanted to eliminate his money problems with banco slips and threatened the heaviest penalties if the estates refused to sign the banco slips issued in the amount of 1 million Reichstaler . Formally, the bank notes were interest-bearing, limited in time and could be transferred by means of an endorsement (giro); therefore legally they came close to an order bond . Cologne Banco notes were interest-bearing and transferable, so they still had the characteristics of a bond. Those who bought the banco notes had to pay for them with Reichstaler coins and now had a claim against the “Banco di gyro d'affrancatione”. On March 27, 1705 Willem issued the diploma for the bank statute; after that the activities stopped for the time being. Only on April 30, 1706 was a "bank instruction" issued naming the organs , on May 5, 1706 Willem demanded ten times the amount payable in 10 years from the deputies instead of the originally required subscription of 106,000 thalers each. In 1706 the first bank notes came into circulation. The endless dispute and the ongoing war were partly responsible for the repayment difficulties that began later.

The redemption of these and other tranches did not go smoothly. The bank notes were provided with a due date, so that there were repayment difficulties with the due dates from 1713. Instead of redeeming the due bank notes for Reichstaler, new issues were issued ("rescribed") for old notes . The sovereigns made it clear that neither they nor the country were liable for the redemption of the banco slip. On July 27, 1713, the city of Cologne wrote to the elector that it recommended that the courts “deal lightly with the claims of the holders of bank notes against the bank”. In August 1713 the bank's liabilities had risen to 5 million Reichstaler. Willem drafted a new bank statute on September 16, 1713. In the same year the Reich Chamber of Commerce ruled that state “banco notes”, which had been issued by the Electoral Palatinate Bank in Cologne, had to be accepted as a means of payment . As a result, the banco notes were equated with the official means of payment.

The loss of confidence triggered by the repayment problems meant that the notes could only be traded at discounts of 30% to 40%. From 1725 onwards, the deputies subject to supervision were prohibited from examining the bank's books. From 1733 onwards, the creditors no longer received any interest. Between March 1, 1750 and 1777, they were redeemed at a third of their nominal amount - and thus an early debt relief was achieved . Only a decree of August 21, 1751 allowed the deputies to inspect the bank records again. Audits of accounts are proven until 1798, so that the bank should have been liquidated shortly thereafter.

Original bank notes have not been preserved; only one contemporary copy is in the State Archives in Düsseldorf.

Austria

The so-called banco slips were also the first paper money in Austria . From July 1, 1762, they were issued by the Wiener Stadtbanco in the equivalent of 5, 10, 25, 50 and 100 guilders (2  florins = 1 convention thaler ). At that time, the issue of paper money was a new form of borrowing cheap government debt, as bank notes, unlike bonds or loans, did not bear interest. In order to increase their acceptance, it was decreed that at least half of the tax debts were to be paid in bank notes. This currency was in circulation until 1812.

The Austrian treasury was in constant financial need during the Seven Years' War from 1756. That is why the search was on for inexpensive forms of financing without causing the coin rate to deteriorate . It was not until 1750 that a stable currency was created with the convention thaler. Since the city of Vienna was considered more creditworthy than the state treasury itself, the Wiener Stadtbanco, which had existed since 1706, was placed under the direct control of the court chamber in 1759 and commissioned with the issue of five percent bonds to cover the financing requirements . When in 1761 alone the outflow from the state budget ( new debt ) amounted to 13 million guilders, Empress Maria Theresia decided to dare an innovative form of financing. With a patent dated July 1, 1762, the Wiener Stadtbanco was commissioned to issue non-interest-bearing paper money, so-called banco notes, in the amount of 12 million guilders. In the future, these would be accepted as a means of payment by both the bank and the public authorities. The first bank notes were initially issued for 5, 10, 25, 50 and 100 guilders. In order to increase the acceptance among possible creditors, it was decreed that from a minimum amount of 200 guilders these banco notes can be converted into normal bonds of the Wiener Stadtbanco with five percent interest. In addition, tax debts should in future be paid at least half in this new paper money. The advantage for investors was that small amounts could be invested, even if they did not earn interest, at least with a state guarantee. In the short term, this even meant that banco notes were more popular than silver coins and were traded at a premium of one to 2.5 percent. To strengthen the credibility, the returning bank notes were demonstratively publicly burned in an oven. A year later, in 1763, the state finances had already been restructured to such an extent that the Wiener Stadtbanco could issue new bonds with a reduced interest rate of four percent, which significantly reduced the interest burden.

In the years 1771 and 1785 further issues were made, this time also with bank notes for 500 and 1,000 guilders. During the Turkish war that followed from 1788 and especially in the coalition wars triggered by the French Revolution , the financial needs of the state treasury increased enormously. In the last years of Maria Theresa's reign, government spending was still 90 million guilders per year, but under Emperor Franz II in 1798 it already reached 572 million guilders. Therefore, the amount of paper money in circulation was increased many times over. If the issue volume of the banco notes had previously been publicly announced, further large sums were secretly issued from 1796 onwards. In the following year, however, a mandatory statutory rate had to be ordered. A total of 74 million guilders were already in circulation in the form of paper money in 1797. At the same time, gold and silver money was increasingly withdrawn from circulation. The need for change is revealed in the population first by issuing defieient silver coins, for which the nominal value did not reflect the value of the silver contained. Later they even switched to issuing copper coins as partial sums of bank notes.

From 1800 and 1806, the creation of money rose to dangerous heights due to the printing of new bank notes. The reparation payments that had to be made to France after the loss of the Fifth Coalition War in the Peace of Schönbrunn concluded between Emperor Franz II and Napoleon in 1809 , further fueled inflation . Only three months later, on February 20, 1811, Austria had to declare national bankruptcy . The banco slips suddenly lost value and, like the partial coins issued, could only be exchanged for so-called “ redemption coupons ”, which became known as “ Viennese currency ”, at a ratio of 5: 1 . The official expiry date of any banco slip was May 31, 1812.

However, when the fortunes of war against Napoleon improved in the following years, the creditworthiness of the Austrian treasury rose again. In anticipation of a future currency, paper money was issued again as early as 1814/15. However, since the number of “ redemption coupons ” was not increased in order not to endanger their value, these new banknotes were called “ anticipation coupons ”. From May 1815 onwards, the disrupted state finances were put back into order. On June 1, 1816, based on the English and French model, the “ Privileged Austrian National Bank ” was founded and given the sole privilege to issue banknotes in the future. The “ Viennese currency ” was gradually redeemed in newly minted convention coins.

Switzerland

In Switzerland there were before the authorization of the Swiss National Bank 36 to the sole issue of banknotes Zeddelbanken which Zeddel duties as promissory notes of the bank and cash. As an example of a former Zeddelbank can Federal Bank are listed.

literature

Individual evidence

  1. ↑ Michael Brueckner, Von Bullen, Mäusen und Moneten , 2012
  2. ↑ Johann Heinrich Zedler / Johann Peter von Ludewig / Carl Günther Ludovici, Large Complete Universal Lexicon of All Sciences and Arts , 1748, p. 307
  3. ↑ Peter Fuchs (Ed.), Chronicle of the History of the City of Cologne , Volume 2, 1991, p. 90
  4. ↑ Carl-Ludwig Holtfrerich, Frankfurt as a Financial Center , 1999, p. 101
  5. ^ Heinrich von Poschinger: Banking and Banking Policy in Prussia , Volume 1, 1878, p. 71.
  6. ↑ Margrit Fiederer, Money and Possession in Civil Tragedy , 2002, p. 30
  7. ^ Heinrich von Poschinger: Banking and Banking Policy in Prussia , Volume 1, 1878, p. 74.
  8. ^ Historical archive of the city of Cologne (Best. 310G Reichskammergericht, A 91 [loss on March 3, 2009]); In it print: Brief information about the Banco di Affrancatione , Düsseldorf 1711, introduced by her electoral highness in Palatinate in the Holy Roman Empire instead of Cöllen
  9. ^ Heinrich von Poschinger: Banking and Banking Policy in Prussia , Volume 1, 1878, p. 82.
  10. ^ Heinrich von Poschinger: Banking and Banking Policy in Prussia , Volume 1, 1878, p. 81 f.
  11. ^ Heinrich von Poschinger: Banking and Banking Policy in Prussia , Volume 1, 1878, p. 85.
  12. ↑ Copy of the copy in: Kreissparkasse Köln, Das Fenster , September 1955, p. 2 (PDF; 3.5 MB)
  13. ↑ Jakob Tanner: Swiss National Bank - 2 Historical Development. In: Historical Lexicon of Switzerland . June 29, 2015 , accessed February 12, 2019 .