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Maltese Bank and Currency
Notes
The first banknotes of Malta
were issued by the Banco Anglo-Maltese, established in
1809, and by the Banco di Malta, established in 1812. The
notes
were issued in various denominations of scudi with 12 scudi
equivalent to one pound sterling. These banknotes were
not accepted by government departments and were issued more
for
the convenience of the commercial body. In 1855, when sterling
was declared the sole legal tender in Malta, banks stopped
issuing notes in scudi and introduced notes in pounds sterling
in denominations of £1, £5, £10, £20, £30, £50
and £100. Between 1873 and 1875, these notes were
overprinted 'Payable in Sicilian Dollars', reflecting the
wide-spread
popularity of the Sicilian dollar, notwithstanding the
1857 proclamation.
Banknotes ceased being issued in 1878.
However, when the Sicilian dollar was withdrawn between November
1885 and February 1886 following a decree by the Italian
government, the banks again reverted to the issue of notes
in sterling.
In 1882 the entire business of the Treasury
Chest in Malta was transferred to the Anglo-Egyptian Banking
Company's branch which had been opened the previous year.
In 1886, approval was given for the issue of the bank's own
notes. All these private issues continued to be made until
1903.
The first official
Maltese Currency Notes were issued on August 1914, prompted
by reasons of expediency
and precaution. Following the outbreak of the First World
War, a massive hoarding of gold and silver coins set in,
generating a run on the banks. Under such emergency conditions,
Ordinance No VIII of 1914 was rushed, providing for the issue
of temporary paper currency. The new issue was in denominations
of five shillings, ten shillings, £1, £5 and £10.
Between 7 May and 30 September 1915, these notes were demonetised
and replaced by British notes, in denominations of £1
and 10 shillings, which remained in circulation for some
twenty years. With the outbreak of World War II, legislation
was passed on 13 September 1939, authorising the Maltese
government to issue Maltese notes in denominations of 2/-,
2/6, 5/-, 10/- and £1. These were put into circulation
at different dates during 1940, except for the 2/- note which
was issued in March 1942. A 1/- note (overprinted on old
2/- unissued stock) was issued in November 1942 and replaced
by a new 1/- note in 1943. The issue of small denomination
paper currency was necessitated by the scarcity of metal
for coinage, and by the difficulty of shipping British currency
to Malta during the war. With the war's end, these small
denomination notes became obsolete and fell into disuse,
mainly because paper wore out too quickly, and they were
again replaced by British coins which continued to circulate
as legal tender up to 1972.
The notes issued in Malta during the Second
World War were uniface (single faced) notes except for the
1/- note which represented an overprint on old stocks of
the 1918 2/- note. This was probably a wartime austerity
measure applicable to note issues for the British colonial
empire, as all other colonial note-issuing territories had
similar uniface notes. The Malta notes therefore formed part
of the colonial omnibus issues.
The paper currency issued during both World
Wars though intended only for temporary use, was however
found convenient, and Ordinance No 1 of 1949 (The Currency
Notes Ordinance) finally put the issue of local paper currency
on a permanent basis. Between 1949 and 1968 the notes detailed
below were issued by the Currency Board.
On 8 May 1951, new
10/- and £1 Maltese
notes came into circulation. These came to be known as the
'New' series. Similar notes bearing Queen Elizabeth's portrait
were issued in April 1954 to commemorate Her Majesty's visit
to Malta.
On 2 June 1961 a £5 denomination
note was issued for the first time, bearing the famous Annigoni
portrait of HM The Queen. Two years later a 10/- and £1
note were issued on the same design, and these three came
to be known as the ‘Pictorial’ series.
The Central Bank of Malta, which was established
by the Central Bank Act of 1967 and began operating on 17
April 1968, took over the assets and liabilities of the Note
Security Fund from the Currency Board in June 1968.
From that date responsibility
for the issue of currency notes passed to the Central Bank
and during the
same month the Bank issued its first 10/- and £5 notes
bearing the same design as the 'Pictorial' series. The £1
note in this series was issued on 24 September 1969 and these
three notes were called the CBM 1st series.
The Central Bank
issued its second series, the CBM 2nd series, on 15 January
1973. The 10/- note was
dropped (a 50c coin had been issued in May 1972 as part of
the coin changeover to decimalisation) and a £M10 note
was introduced.
The third series,
called the CBM 3rd series, was issued on 30 March 1979,
and has kept the same denominations
of £M1, £M5 and £M10 as the previous one.
On 17 March 1986, the Central Bank issued
a new set of four notes -namely Lm2, Lm5, Lm10, Lm20 called
the CBM 4th series. This issue marked
the appearance of the Lm20 and the Lm2 note. The Lm1 note
was replaced in 1986 by a coin. For the first time the notes
included a portrait of the President of the Republic as Head
of State.
On 18 September
1989 the Bank issued a new set of currency notes, the fifth
series. This coincided with the twentyfifth anniversary
of Malta’s Independence. These banknotes, which had
the same denominations as those of the fourth series, were
enhanced with security
features in 1994.
On 20 March 1974, legislation was passed
whereby notes demonetised previously would no longer be exchangeable
at the Central Bank as from 20 March 1984, and other notes
would no longer be exchangeable as from 10 years after their
demonetisation date.
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