Newfoundland dollar
Encyclopedia
The dollar was the currency of the colony and Dominion of Newfoundland
from 1865 until 1949, when Newfoundland
became a province of Canada
. It was subdivided into 100 cent
s.
adopted the gold standard, and the dollar replaced the pound
at a rate of 1 dollar = 4 shilling
s 2 pence
(50 pence) sterling
, slightly higher than the Canadian dollar
(worth 4s 1.3d). The significance of this rating was that two cents would be equal to one penny sterling. It was seen as a compromise between adopting the British system or the American system. It also had the effect of aligning the Newfoundland unit to the dollar unit in the British Eastern Caribbean colonies. The West Indian dollar was directly descended from the Spanish Dollar (Pieces of Eight). Newfoundland was unique in the British Empire
in that it was the only part to introduce its own gold coin in conjunction with its gold standard. Newfoundland two dollar coins were minted intermittently until the Newfoundland banking crash of 1894. In 1895, following this banking crisis, the Canadian banks moved into Newfoundland and the value of the Newfoundland dollar was adjusted to set it equal to the Canadian dollar, a devaluation of 1.4%. The Newfoundland dollar was replaced by the Canadian dollar at par when Newfoundland joined Canada
in 1949.
The other British North American colonies adopted the American unit around the same time that Newfoundland adopted the West Indian unit. The small disparity between the American unit and the West Indian unit was because in 1792, Alexander Hamilton
at the US treasury took an average weight of worn Spanish Dollars to be the new American unit of currency.
The Newfoundland decimal coinage would have corresponded exactly to the dollar unit that was used in another British colony in South America
. British Guiana
used accounts based on the Spanish dollar
, but these accounts were used in conjunction with the sterling
coinage.
was struck in bronze, the 5, 10 and 20 cents in silver and the 2 dollars (also denominated as "Two Hundred Cents" and "One Hundred Pence") in gold. Silver 50 cents were introduced in 1870, with the 20 cents replaced by a 25 cent coin in 1917. A smaller 1 cent coin was introduced in 1938.
In 1865, one chartered bank
, the Commercial Bank of Newfoundland began issuing notes denominated in pounds and dollars, using a rate of 4 dollars = 1 pound. As this rate matches the rate used in Canada at the time, it may be that these notes were not intended for use as Newfoundland dollars. In the 1880s, both the Commercial Bank and the Union Bank of Newfoundland issued notes denominated solely in dollars.
Denominations of 2, 5, 10, 20 and 50 dollars were issued. However, in 1894, both banks crashed.
The Department of Public Works introduced government cash notes in 1901 in denominations of 40, 50 and 80 cents, 1 and 5 dollars. In 1910, 25 cents and 2 dollars were added. In 1920, the Treasury introduced 1 and 2 dollar notes.
Dominion of Newfoundland
The Dominion of Newfoundland was a British Dominion from 1907 to 1949 . The Dominion of Newfoundland was situated in northeastern North America along the Atlantic coast and comprised the island of Newfoundland and Labrador on the continental mainland...
from 1865 until 1949, when Newfoundland
Newfoundland and Labrador
Newfoundland and Labrador is the easternmost province of Canada. Situated in the country's Atlantic region, it incorporates the island of Newfoundland and mainland Labrador with a combined area of . As of April 2011, the province's estimated population is 508,400...
became a province of Canada
Canada
Canada is a North American country consisting of ten provinces and three territories. Located in the northern part of the continent, it extends from the Atlantic Ocean in the east to the Pacific Ocean in the west, and northward into the Arctic Ocean...
. It was subdivided into 100 cent
Cent (currency)
In many national currencies, the cent is a monetary unit that equals 1⁄100 of the basic monetary unit. Etymologically, the word cent derives from the Latin word "centum" meaning hundred. Cent also refers to a coin which is worth one cent....
s.
History
In 1865 NewfoundlandHistory of Newfoundland and Labrador
The History of Newfoundland and Labrador is the story of the peoples who have lived in what is now the Canadian province of Newfoundland and Labrador....
adopted the gold standard, and the dollar replaced the pound
Newfoundland pound
The pound was the currency of Newfoundland until 1865. It was subdivided into 20 shillings, each of 12 pence. The Newfoundland pound was equal to the British pound and British coins circulated, supplemented by locally produced tokens and banknotes...
at a rate of 1 dollar = 4 shilling
Shilling
The shilling is a unit of currency used in some current and former British Commonwealth countries. The word shilling comes from scilling, an accounting term that dates back to Anglo-Saxon times where it was deemed to be the value of a cow in Kent or a sheep elsewhere. The word is thought to derive...
s 2 pence
Penny
A penny is a coin or a type of currency used in several English-speaking countries. It is often the smallest denomination within a currency system.-Etymology:...
(50 pence) sterling
Pound sterling
The pound sterling , commonly called the pound, is the official currency of the United Kingdom, its Crown Dependencies and the British Overseas Territories of South Georgia and the South Sandwich Islands, British Antarctic Territory and Tristan da Cunha. It is subdivided into 100 pence...
, slightly higher than the Canadian dollar
Canadian dollar
The Canadian dollar is the currency of Canada. As of 2007, the Canadian dollar is the 7th most traded currency in the world. It is abbreviated with the dollar sign $, or C$ to distinguish it from other dollar-denominated currencies...
(worth 4s 1.3d). The significance of this rating was that two cents would be equal to one penny sterling. It was seen as a compromise between adopting the British system or the American system. It also had the effect of aligning the Newfoundland unit to the dollar unit in the British Eastern Caribbean colonies. The West Indian dollar was directly descended from the Spanish Dollar (Pieces of Eight). Newfoundland was unique in the British Empire
British Empire
The British Empire comprised the dominions, colonies, protectorates, mandates and other territories ruled or administered by the United Kingdom. It originated with the overseas colonies and trading posts established by England in the late 16th and early 17th centuries. At its height, it was the...
in that it was the only part to introduce its own gold coin in conjunction with its gold standard. Newfoundland two dollar coins were minted intermittently until the Newfoundland banking crash of 1894. In 1895, following this banking crisis, the Canadian banks moved into Newfoundland and the value of the Newfoundland dollar was adjusted to set it equal to the Canadian dollar, a devaluation of 1.4%. The Newfoundland dollar was replaced by the Canadian dollar at par when Newfoundland joined Canada
Canadian Confederation
Canadian Confederation was the process by which the federal Dominion of Canada was formed on July 1, 1867. On that day, three British colonies were formed into four Canadian provinces...
in 1949.
The other British North American colonies adopted the American unit around the same time that Newfoundland adopted the West Indian unit. The small disparity between the American unit and the West Indian unit was because in 1792, Alexander Hamilton
Alexander Hamilton
Alexander Hamilton was a Founding Father, soldier, economist, political philosopher, one of America's first constitutional lawyers and the first United States Secretary of the Treasury...
at the US treasury took an average weight of worn Spanish Dollars to be the new American unit of currency.
The Newfoundland decimal coinage would have corresponded exactly to the dollar unit that was used in another British colony in South America
South America
South America is a continent situated in the Western Hemisphere, mostly in the Southern Hemisphere, with a relatively small portion in the Northern Hemisphere. The continent is also considered a subcontinent of the Americas. It is bordered on the west by the Pacific Ocean and on the north and east...
. British Guiana
British Guiana
British Guiana was the name of the British colony on the northern coast of South America, now the independent nation of Guyana.The area was originally settled by the Dutch at the start of the 17th century as the colonies of Essequibo, Demerara, and Berbice...
used accounts based on the Spanish dollar
Spanish dollar
The Spanish dollar is a silver coin, of approximately 38 mm diameter, worth eight reales, that was minted in the Spanish Empire after a Spanish currency reform in 1497. Its purpose was to correspond to the German thaler...
, but these accounts were used in conjunction with the sterling
Pound sterling
The pound sterling , commonly called the pound, is the official currency of the United Kingdom, its Crown Dependencies and the British Overseas Territories of South Georgia and the South Sandwich Islands, British Antarctic Territory and Tristan da Cunha. It is subdivided into 100 pence...
coinage.
Coins
In 1865, coins were introduced in denominations of 1, 5, 10 and 20 cents, and 2 dollars. The 1 centNewfoundland one cent
As Newfoundland did not join the Dominion of Canada until 1949, it had its own currency for many decades. It adopted its own decimal currency in 1863. Compared to other pre-Confederation British colonies, it had a wide selection of decimal coinage...
was struck in bronze, the 5, 10 and 20 cents in silver and the 2 dollars (also denominated as "Two Hundred Cents" and "One Hundred Pence") in gold. Silver 50 cents were introduced in 1870, with the 20 cents replaced by a 25 cent coin in 1917. A smaller 1 cent coin was introduced in 1938.
Banknotes
Banking in Canada
Banking in Canada is widely considered the most efficient and safest banking system in the world, ranking as the world's soundest banking system for the past three years according to reports by the World Economic Forum. Released at October 2010, Global Finance magazine put Royal Bank of Canada at...
, the Commercial Bank of Newfoundland began issuing notes denominated in pounds and dollars, using a rate of 4 dollars = 1 pound. As this rate matches the rate used in Canada at the time, it may be that these notes were not intended for use as Newfoundland dollars. In the 1880s, both the Commercial Bank and the Union Bank of Newfoundland issued notes denominated solely in dollars.
Denominations of 2, 5, 10, 20 and 50 dollars were issued. However, in 1894, both banks crashed.