The pound was the currency of the Bahamas until 1966. It was equivalent to the pound 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...

 and was divided into 20 shillings, each of 12 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:...

. Ordinary UK coinage circulated. Apart from an old Bahamas penny coin struck in 1806, there were no special sterling coin issues such as were found in Jamaica.

History

In 1825, an imperial order-in-council was passed for the purposes of introducing the British coinage into all the British colonies. It wasn't immediately very effective due to unrealistic ratings, and it required a further order-in-council to be passed in 1838. By the middle of the nineteenth century, British coinage had replaced the Spanish dollar throughout all of the British West Indies. But it was only in the Bahamas, Bermuda, and Jamaica that the pound unit of account was used. In the Eastern Caribbean territories and in British Guiana, the dollar unit of account was retained in conjunction with the British coinage at a fixed rate of one dollar equal to four shillings and two pence. Unlike in Bermuda, the US dollar circulated freely alongside the British sterling coinage in the Bahamas.

The pound was replaced by the dollar

Bahamian dollar

The dollar has been the currency of The Bahamas since 1966. It is normally abbreviated with the dollar sign $, or alternatively B$ to distinguish it from other dollar-denominated currencies. It is divided into 100 cents....

 in 1966, at a rate of 7 shillings = 1 dollar (1 pound = 2.86 dollars). This rate meant that the new Bahamas dollar was at a slight discount to the US dollar.

For a wider outline of the history of currency in the region, see currencies of the British West Indies

Currencies of the British West Indies

This article examines the monetary systems that prevailed in the region known as the British West Indies in the nineteenth and twentieth centuries. The territories covered in this article include British Guiana on the South American mainland, British Honduras in Central America, Bermuda, the...

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Coins

The only coin issued was a 1 penny coin struck in 1806. British coins circulated on the islands until 1966.

Banknotes

The Bank of Nassau initially issued notes in denominations of 5 and 10 shillings, and 1 pound. 4 shilling notes were introduced in 1906. The last notes were issued in 1916.

The Public Treasury issued 1 pound notes in 1868, followed by government notes in 1869 for 1 and 5 pounds. In 1919, a new series of 4 and 10 shillings, and 1 pound notes was introduced, with 5 pound notes reintroduced after 1936.