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History of Banking in Scotland
Appendix A - Earliest Scottish Bank Notes

EDINBURGH, 13th May 1902.

Royal Bank of Scotland,
Hope Street.

Dear Mr. Kerr—I have only now been able to look into the interesting questions—as to the dates, etc., of the earliest bank notes in Scotland—raised in your letter of 9th ultimo.

In the first place, I would like to mention that, in the course of my examination of the records of the Bank, I have quite failed to find any confirmation of the particular statement made by the writer of the Historical Account of the Bank of Scotland, to which you refer, viz, that there was an issue of 20s. notes in 1699.

The facts about the issue of 20s. notes appear to be these :Early in 1699 an overture to print 20s. notes was brought before the Directors of the Bank, and after some discussion, it was referred to a General Meeting of the Adventurers (Proprietors), which was held on 24th March 1699. At this meeting the matter was put to the vote, but, the negatives preponderating, it was set aside. Next year (1700) a Committee of Directors met to consider certain proposals made by the founder of the Bank (John Holland, the London Merchant), "concerning the supplying the want of notes for sums below £5." Mr. Holland suggested two ways, viz. (1) by using brass coins, and (2) by using tallies of timber. After careful deliberation the Committee, while unanimously agreed as to the advantages which would accrue from an issue of small notes, set aside Mr. Holland's proposals on the ground that they were "inconsistent with the laws of the Kingdom, and very impracticable both to the Bank and the Nation."

The question of the issue of £ 1 notes does not appear to have come up again until the year 1704, when a "new overture for making twenty-shilling notes" was brought before the Bank. The matter was discussed at several meetings of the Directors, and finally referred to a General Meeting of the Adventurers, which was held on 10th March 1704. At this meeting a resolution was passed that "twenty-shilling sterling notes" should be made and "be ready to go abroad as soon as possible"; and the necessary steps were accordingly taken to have this done. In a succeeding minute these twenty-shilling notes are referred to as "twelve-pound Scots notes." The first entry, therefore, in the Bank's ledger for £1 notes appears on 7th April 1704. They are entered in the books as £ 1 sterling.

With regard to Large Notes, these were issued from the time the Bank commenced business in 1696, and were of the values of £100, £50, £20, £10, and £5 sterling. In a minute, dated 26th February 1700, there is an instruction that "the Treasurer and Accountant at signing the notes subjoin to their ordinary subscription the sum of the Bill in Scots Money."

The fact of the notes being at that early date printed in London (under the supervision of the English trustees of the Bank resident there) may throw some light on the circumstance of so large denominations being issued in sterling.

I trust I have answered the various queries contained in your letter, but, should any point have been overlooked, I will be very pleased to endeavour to supply the omission on hearing from you.—Yours very truly,

(Signed) J. S. BARBOUR,

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