Bank of England Museum

The Bank of England Museum is located within the Bank of England in the City of London. The museum displays a wide-ranging collection detailing the history of the Bank from its foundation in 1694 to the modern-day. The displays include a representation of a late 18th-century office, known as the Stock Office, where holders of Bank stock would come to collect their dividends. Exhibits cover the history of the bank in chronological order, including many images showing the history of the bank and its building.

The rotunda area, at the end of the tour, displays the bank’s collections of notes and coins, books and documents, pictures, furniture, statues, silver and a genuine bar of gold. Kenneth Grahame, the author of The Wind in the Willows, worked for 30 years at the Bank, his final post being that of the Bank’s Secretary, and the museum has a permanent display on his association with the bank, which includes his resignation letter.

The Museums entrance is in Bartholomew Lane, off Threadneedle Street, close to Bank junction and Bank tube station.

A Tour of the Bank of England Museum

The First £1 note, 1797
Running Cash Notes
Gold Coins and Gold Bars
Lord Nelson’s Power of Attorney, 1797

The First £1 note, 1797
- The first £1 note was introduced by the Bank of England in 1797, following the gold shortages caused by the French Revolutionary Wars. During the French Revolutionary Wars, fear of French invasion led to a run on the banks. To maintain gold reserves, the payment of gold for banknotes was suspended. The first £1 notes were issued to compensate for the lack of gold coins in circulation.

Running Cash Notes
- This Running Cash Note is dated 18th June 1697 and represents a deposit of £22; this is the earliest known running cash note. It is entirely handwritten. At the first meeting of the Bank of England’s Court of Directors, they considered how the Bank would deal with the issue of notes. They decided that the deposit of coins would be acknowledged in three different ways: Issuing a Running Cash Note, as a receipt payable to the depositor or bearer which allowed full or partial withdrawal; Annotating a piece of paper or book held by the customer, similar to recent passbook accounts; and Acting on the depositor’s instructions to pay a third party, similar to a cheque process. It soon became apparent that the Running Cash Note was the most popular, and the Bank determined that it was essential for its business. It was the success of Running Cash notes that led to the introduction of the banknote that we know today.

Gold Coins and Money
- Gold objects and metal ore were used in commerce in the Ancient Near East since the Bronze Age, but gold coins originated later, during the 6th century BC, in Anatolia. The name of King Croesus of Lydia remains associated with the invention. The gold content of naturally occurring electrum in modern Western Anatolia ranges from 70% to 90%, in contrast to the 45–55% of gold in electrum used in the ancient Lydian coinage of the same geographical area. This suggests that one reason for the invention of coinage in that area was to increase the profits from the King’s right to issue coin with a lower gold content than the commonly circulating metal.

- Electrum Gold Coin from Lydia, 650 BC
  - This Electrum Gold Coin from Lydia, dated to 650 BC, represents the first coins from the ancient kingdom of Lydia (today in modern Turkey). They were made of Electrum, which is a naturally occurring alloy of gold and silver. The ancient Greeks called it ‘gold’ or ‘white gold,’ as opposed to ‘refined gold.’ Its color ranges from pale to bright yellow, depending on the proportions of gold and silver. Ancient Lydia was famous for its god that was found in the sands of the River Pactolus.
- Roman Gold Bars, 375 AD
  - These Roman Gold Bars from 375 AD represent the few Roman gold cars to survive. Most were melted down for coinage. These were discovered as part of a hoard that was buried for safe-keeping in Czofalva, Hungary, in the late 4th century. The owners never collected them, and the cache lay undiscovered until they were found in 1887. These Gold currency-bar stamped with rectangular stamps record the name of the procurator, and sometimes the name of the assayer.
- William III Five Guinea Coin, 1699
  - This William III Five Guinea Coin from 1699 was made of gold, which had come from the Guinea region in West Africa, which gave the coins their name. The origin of the gold as indicated by the tiny elephant beneath the portrait of the King. The first guinea was produced in 1663, and the denomination was originally worth one pound, or twenty shillings. An increase in the price of gold during the reign of King Charles II led to the market trading it at a premium. The price of gold continued to increase, especially in times of trouble, and by the 1680s, the coin was worth 22 shillings.

Lord Nelson’s Power of Attorney, 1797
- This Power of Attorney was drafted and signed by Lord Nelson on 17th October 1797, giving his permission to a third party to administer his investments in the Bank of England. This document is dated a few months after Nelson lost his right arm in the Battle of Santa Cruz de Tenerife. The shaky signature ‘Horatio Nelson’ was written with his left hand, which he had not yet trained to sign his name.

Bank of England Museum

Museum: Bank of England Museum
City: London
Country: United Kingdom
Established: 1988
Type: Banking & Finance Museum
Location: Bartholomew Ln, London, UK

Quotes on Banking

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“I sincerely believe… that banking establishments are more dangerous than standing armies.”
– Thomas Jefferson

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“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
– Henry Ford

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“Banking may well be a career from which no man really recovers.”
– John Kenneth Galbraith

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“A bank is a place where they lend you an umbrella in fair weather and ask for it back again when it begins to rain.”
– Robert Frost

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“There’s more honor in investment management than in investment banking.”
– Charlie Munger

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“Clear communication is always important in central banking, but it can be especially important when economic conditions call for further policy stimulus, but the policy rate is already at its effective lower bound.”
– Ben Bernanke

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“If you owe your bank a hundred pounds, you have a problem. But if you owe a million, it has a problem.”
– John Maynard Keynes

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“Banking is a very good business if you don’t do anything dumb.”
– Warren Buffett

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“I do not think you can trust bankers to control themselves. They are like heroin addicts.”
– Charlie Munger

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“It is not by augmenting the capital of the country, but by rendering a greater part of that capital active and productive than would otherwise be so, that the most judicious operations of banking can increase the industry of the country.”
– Adam Smith

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“A large income is the best recipe for happiness I ever heard of.”
– Jane Austen – Mansfield Park

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“In central banking as in diplomacy, style, conservative tailoring, and an easy association with the affluent count greatly and results far much less.”
– John Kenneth Galbraith

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“I sincerely believe… that banking establishments are more dangerous than standing armies.”
– Thomas Jefferson

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Photo Credit: JOM

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