Withdrawals and Supercessions of the Bank of Canada .

 

Canada 's central bank, the Bank of Canada, was established by the Bank Act of 3 July, 1934 although it opened its doors for business only on 11 March 1935 . On that date, as part of its functions, a whole series of its bank notes were released to supercede the old Dominion notes and, in time, totally replace the notes of the chartered banks as well.

These new notes, the "Issue of 1935", were in some respects quite different from those that had gone before - as well as those that would come after. In the first place, the old "horse blanket"-size Dominion notes was dimensionally shrunken to something like 6"x3" (actually 2 ? inches in height, to be precise) at a considerable saving in printing costs (The chartered banks weren't long in following suit). For the first time, the special bank note paper, supplied by Howard Smith Co., included the imbedded coloured "planchettes" as a protection against counterfeiting; a $1 note could not then be bleached to supply the genuine paper for a fake, say, $20 since the planchettes were designed to smear through the paper under bleach. This particular device was to continue in use for decades. Unlike the "Dominion of Canada" notes, the issue of 1935 saw unilingual notes in both English and French appearing. Since the numbers of each were dictated by demand from the banks across the entire Dominion, it turned out the English version was usually something like four times as large as the French.

The range of denominations was also new. Until this time, the largest Dominion note for circulation was the $5 with notes of the chartered banks supplying the rest of the needs - except for large-denomination Dominion "bank legals" which the public never saw. But the Bank of Canada now issued: $1, $2, $5, $10, $20, commemorative $25, $50, $100, $500 and $1000. Each showed a different member of the royal family, except for the $500 (Sir John A. Macdonald) and $1000 (Sir Wilfrid Laurier). Except for the $25, all the reverses showed different allegories adapted by American Bank Note Company engravers from paintings supplied by the Canadian artist Alonzo Earl Foringer. The reverse of the $25 was adapted from a photo of Windsor Castle by Raphael Tuck & Son of London .

Like the Dominion notes, those of 1935 were printed in blocks of four with the same serial number but each note differentiated by having a separate plate number: A, B, C or D. Like before each serial number was preceded by a series letter but this time A denoted the English issue (also B on the $1) and F the French issue. In case a given denomination run through the whole series and need to be started again, there was a "1" printed at the right - but there was never any need for a "2".

 

$25, Issue of 1935. Essentially a commemorative note, its face value was too large for most people to save as a souvenir. Its withdrawal was ordered begun in early 1937 and as a denomination, was never printed again. Close to 99% of them have been redeemed.

All the 1935 denominations are dated "Issue of 1935" or "Emission de 1935" - except for the $25. This was a commemorative issue marking the 25th anniversary of George V's reign and is therefore dated "May 6th 1935" or "6 Mai 1935" - even though this was five days before the Bank opened its doors. (Actually, it was released May 2nd.)

There was every reason to believe that the series of 1935 would be in use for some time, but that was not to be. On 20 January, 1936 , George V died, bringing his son, Edward VIII to the throne. This entailed an entire revamping of the Bank of Canada notes but with nearly a year's lead-time, this seemed no problem. Nor was it; by November, all was in place. However, in December, Edward abdicated his throne in favour of his brother Albert, the Duke of York, who assumed the title George VI and now there was scarcely any time to change the notes yet again.

To cut down on time, George's portrait that had appeared on the 1935 $50 note was lifted wholesale and used in the center of his new notes, this time on the $1, $2, $5, $10, $20 and $50 instead of a different personage as in 1935. Both the $25 and $500 denominations were dropped and the $100 bore Sir John A. Macdonald's portrait while Sir Wilfrid Laurier appeared on the $1000 just as already intended on Edward's 1937 series. Despite the date "Jan. 2, 1937" engraved on the notes, the $1 through $100 were not released until July 21 - really not bad considering the amount of extra work that had to be done at the last minute and that all printing plates as well as any notes printed from them had to be scrapped.

There were changes. Rather than separate English and French notes, there was now just one bilingual note per denomination, the left half generally English, the right half generally French. For this reason, George's portrait was moved to the center, as were those of Macdonald and Laurier. For the first time, each note had its own serial number, the plate numbers having been eliminated and each serial number was preceded by series letters appearing as numerator/denominator fractions, the former able to advance up to 20 times (ordinarily, F,G,I,P,Q,and V were not used) before the latter did.

The first 1935 note to be withdrawn was the $25 denomination, only intended as a one-year commemorative in the first place. Total issue had been 140,000 English and 20,000 French. On 18 May, 1937 it was decided to destroy any remaining stocks in the Bank of Canada vaults and recall those in circulation by simply ordering the chartered banks to treat any that they had or would acquire, as "worn, damaged notes", turning them into the Bank for replacement or refund. By August 1942 figures show that only 1,920 of these notes were still outstanding (the figure today more like 1,840).

 

$2, Issue of 1935. Because it was the same blue colour as the $5 of 1937, it was ordered withdrawn in 1937. Over the next year or so, all 1935 denominations save the $1000 would also be withdrawn and destroyed.

Although initially intended to issue 1935 notes still in stock for as long as they lasted, this did not happen. The culprit was the 1935 $2 which used the same blue colour as the new $5 of 1937, causing confusion. It was therefore ordered withdrawn on 18 September, 1937 . Of the 22,340,000 English and 5,300,000 French notes originally printed, Bank stocks consisting of about 3,900,000 new notes still in the original "bricks" went to the furnace. As usual, the chartered banks were to receive but not to pay out to the public any such notes that came their way but ship them back to the Bank for replacement and destruction.

Once started, the process was extended to the other denominations (save the $1000 which was mostly used as a "bank legal"). In February 1938 denominations $1 through $10 were withdrawn and Bank stocks consisting of 824,500 unissued $5 and 356,500 unissued $10 went to the furnace as part of the operation. That July, withdrawal and destruction was extended to the $20, $50, $100 and $500 notes of 1935.

The $500 note of 1935 was a special case - and was never printed again. Much too large for use by the general public, it was at the same time of limited use as a "bank legal", better served by the $1000. Consequently, when the call for withdrawal came, most of this denomination were in the vaults of chartered banks where they had little chance of survival. A total of 20,900 notes in English and 5,000 in French had been issued and very few survived. Today, there are only 46 in total still outstanding and only about half accounted for in collections: generally, it is believed there are today about 20 surviving in English, perhaps only a couple in French. The 1935 French $500 note is one of our major rarities today. The illustration shown is a "Specimen" note from the 1999 Bank of Canada Auction; there may not be an illustration of a circulation example.

 

"Specimen"of $500, Issue of 1935, French.

Of all the 1935 denominations, the $1000 alone was not withdrawn but rather allowed to remain until such time as new supplies were required - and this took many years. A total of 66,500 English and 7,600 French notes had been printed in 1935 but even though 15,000 of this denomination were prepared of the 1937 issue, they were never released until January, 1952 , just shortly before the death of George VI! These latter had the distinction of carrying only the Osborne-Towers signatures, even though J.A.C. Osborne had not been deputy-governor since 14 September, 1938 ! Only a couple of years later, the 1937 "thousands" were joined by the 1954 issue of Elizabeth II.

Of all the "Modified 1954" denominations, only one bears the signature of Thiessen-Crow: the $1000. And that not for long. With the plates for this particular design/signature combination prepared in very late 1987 through early '88, it was decided to upgrade the design at this time. Consequently, although 240,000 notes bearing this signature were printed, the majority were destroyed before release, its place taken by notes of the new design but with the same signatures.

The active withdrawals of the 1935 notes during 1937-8 were the only ones done for many years but, beginning in the late '80s, three denominations were eliminated from Canadian circulation. The first to go was the $1 note, its place taken by the "Loonie" coin. The last day of issue for the dollar note was 30 June 1989; soon banks were receiving them but not paying them out again, shipping them as "worn, damaged" notes for refund to the central Bank where the notes were destroyed. On February 16, 1996 , the turn of the $2 note came, replaced in circulation by the bi-metallic "Twoonie".

 

$1000 of "Modified 1954" issue.

The final note denomination to bite the dust was the Thousand. It was generally believed that this denomination was playing a big part in drug deals for cash and this was quite possibly true if we consider the extraordinary demand for it. From the introduction of the latest design in 1992, there had been printed and distributed well over 6-million of these notes whereas in years past, a few tens of thousands would have sufficed. So it was withdrawn, leaving the Hundred as the largest note in Canadian circulation. On May 11, 2000 , the banks ceased to pay them out.

Wayne Jacobs is a numismatic expert. Currently secretary and editor of the "Mid-Island Coin Club Numismatic Journal"of Nanaimo, Vancouver Island , British Columbia, he is the award winning author of numerous articles. The MICC journal are hosted here: MICC webpages Copyright 2006 Wayne Jacobs. This article may be reprinted freely for non commercial purpose only if the resource box is left intact, linking back to us.