Bank deutscher Länder
Encyclopedia
The Bank deutscher Länder (Bank of the German States), abbreviation BdL, was the forerunner of the Deutsche Bundesbank
. It was founded on 1 March 1948.
The main task of the BdL was to manage currency policy in the American and British occupation zones in Germany (Bizone)
. On 21 June 1948 the Bank deutscher Länder introduced the Deutsche Mark currency in the three western zones of occupation
. On 1 November 1948, state central banks in the French zone, which had adopted Deutsche Mark in June too, joined the BdL. In May 1949 the Federal Republic of Germany (West Germany)
was founded, however, the BdL remained subject to the control of the three Western Allied powers - the United States
, the United Kingdom
and France
until 1951. Later, BdL became an independent agency of the West German states
, similar to the concept of independence displayed by the Federal Reserve System
in the United States.
In the process of introducing the Deutsche Mark
in 1948, the states' central banks , then entities of the individual German states, founded the Bank deutscher Länder as their subsidiary for the central purpose of issuing the new currency, avoiding thus conflicts among the states.
The capital stock
of the BdL, 100,000 Deutsche Mark
, was given by the LZB. When the BdL was established, 300 people worked there, but by 1949, their number had already increased to 1,450. The headquarters of the BdL was located in Frankfurt am Main.
Institutions of the BdL were the board of directors and the Zentralbankrat (Central banking council), consisting of the nine presidents of the Landeszentralbanken. These officials elected the president of the board of directors, who then chose the other members of the board. The board's task was to enforce the resolutions of the Zentralbankrat.
Effective 1 August 1957, the BdL and the central banks of the German states were merged in the new Deutsche Bundesbank with the Landeszentralbanken transformed into mere subsidiaries of the Bundesbank in accordance with the Federal law establishing the Bundesbank.
Deutsche Bundesbank
The Deutsche Bundesbank is the central bank of the Federal Republic of Germany and as such part of the European System of Central Banks . Due to its strength and former size, the Bundesbank is the most influential member of the ESCB. Both the Deutsche Bundesbank and the European Central Bank are...
. It was founded on 1 March 1948.
The main task of the BdL was to manage currency policy in the American and British occupation zones in Germany (Bizone)
Bizone
The Bizone, or Bizonia was the combination of the American and the British occupation zones in 1947 during the occupation of Germany after World War II. With the addition of the French occupation zone in March 1948, the entity became the Trizone...
. On 21 June 1948 the Bank deutscher Länder introduced the Deutsche Mark currency in the three western zones of occupation
Allied Occupation Zones in Germany
The Allied powers who defeated Nazi Germany in World War II divided the country west of the Oder-Neisse line into four occupation zones for administrative purposes during 1945–49. In the closing weeks of fighting in Europe, US forces had pushed beyond the previously agreed boundaries for the...
. On 1 November 1948, state central banks in the French zone, which had adopted Deutsche Mark in June too, joined the BdL. In May 1949 the Federal Republic of Germany (West Germany)
West Germany
West Germany is the common English, but not official, name for the Federal Republic of Germany or FRG in the period between its creation in May 1949 to German reunification on 3 October 1990....
was founded, however, the BdL remained subject to the control of the three Western Allied powers - the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, the United Kingdom
United Kingdom
The United Kingdom of Great Britain and Northern IrelandIn the United Kingdom and Dependencies, other languages have been officially recognised as legitimate autochthonous languages under the European Charter for Regional or Minority Languages...
and France
France
The French Republic , The French Republic , The French Republic , (commonly known as France , is a unitary semi-presidential republic in Western Europe with several overseas territories and islands located on other continents and in the Indian, Pacific, and Atlantic oceans. Metropolitan France...
until 1951. Later, BdL became an independent agency of the West German states
States of Germany
Germany is made up of sixteen which are partly sovereign constituent states of the Federal Republic of Germany. Land literally translates as "country", and constitutionally speaking, they are constituent countries...
, similar to the concept of independence displayed by the Federal Reserve System
Federal Reserve System
The Federal Reserve System is the central banking system of the United States. It was created on December 23, 1913 with the enactment of the Federal Reserve Act, largely in response to a series of financial panics, particularly a severe panic in 1907...
in the United States.
In the process of introducing the Deutsche Mark
German mark
The Deutsche Mark |mark]], abbreviated "DM") was the official currency of West Germany and Germany until the adoption of the euro in 2002. It is commonly called the "Deutschmark" in English but not in German. Germans often say "Mark" or "D-Mark"...
in 1948, the states' central banks , then entities of the individual German states, founded the Bank deutscher Länder as their subsidiary for the central purpose of issuing the new currency, avoiding thus conflicts among the states.
The capital stock
Capital (economics)
In economics, capital, capital goods, or real capital refers to already-produced durable goods used in production of goods or services. The capital goods are not significantly consumed, though they may depreciate in the production process...
of the BdL, 100,000 Deutsche Mark
German mark
The Deutsche Mark |mark]], abbreviated "DM") was the official currency of West Germany and Germany until the adoption of the euro in 2002. It is commonly called the "Deutschmark" in English but not in German. Germans often say "Mark" or "D-Mark"...
, was given by the LZB. When the BdL was established, 300 people worked there, but by 1949, their number had already increased to 1,450. The headquarters of the BdL was located in Frankfurt am Main.
Institutions of the BdL were the board of directors and the Zentralbankrat (Central banking council), consisting of the nine presidents of the Landeszentralbanken. These officials elected the president of the board of directors, who then chose the other members of the board. The board's task was to enforce the resolutions of the Zentralbankrat.
Effective 1 August 1957, the BdL and the central banks of the German states were merged in the new Deutsche Bundesbank with the Landeszentralbanken transformed into mere subsidiaries of the Bundesbank in accordance with the Federal law establishing the Bundesbank.