Luxembourgish franc
Encyclopedia
The Luxembourgish franc was the currency
of Luxembourg
between 1854 and 1999 (except during the period 1941-44). The franc remained in circulation until 2002, when it was replaced by the euro
. During the period 1999–2002, the franc was officially a subdivision of the euro (1 euro = 40.3399 francs) but the euro did not circulate.
Under the principle of "no obligation and no prohibition", financial transactions could be conducted in Euros and Francs, but physical payments could only be made in Francs, as Euro notes and coins were not available yet.
The franc was subdivided into 100 centimes.
led to the French franc's
wide circulation, including in Luxembourg
. However, incorporation into the Netherlands
in 1815 resulted in the Dutch gulden becoming Luxembourg's currency. Following Belgium's
independence from the Netherlands, the Belgian franc
was adopted in 1839 and circulated in Luxembourg until 1842 and again from 1848. Between 1842 and 1848, Luxembourg (as part of the German
Zollverein
) used the Prussia
n Thaler
.
In 1854, Luxembourg began issuing its own franc, at par with the Belgian franc. The Luxembourg franc followed the Belgian franc into the Latin Monetary Union
in 1865. In 1926, Belgium withdrew from the Latin Monetary Union. However, the 1921 monetary union of Belgium and Luxembourg survived, forming the basis for the full Belgium-Luxembourg Economic Union
in 1932. In 1935, the link between the Luxembourg and Belgian francs was revised, with 1 Luxembourg franc = 1¼ Belgian francs.
In May 1940, the franc was pegged to the German Reichsmark
at a rate of 4 francs = 1 Reichsmark. This was changed to 10 francs = 1 Reichsmark in July, 1940. On 26 August 1940, the Reichsmark was declared legal tender in Luxembourg and on 20 January 1941, the Reichsmark was declared the only legal tender and the franc was abolished.http://www.globalfinancialdata.com/index.php3?action=showghoc&country_name=LUXEMBOURG The Luxembourg franc was reestablished in 1944, once more tied to the Belgian franc at par.
The Luxembourg franc was fixed at 1 euro = 40.3399 francs on 1 January 1999. Euro coins and banknotes were introduced on 1 January 2002. Old franc coins and notes lost their legal tender status on 28 February 2002.
With a few early exceptions, the coins were identical in size, shape and composition. Although they had distinct designs, the coins circulated in both Luxembourg and Belgium.
forces. After the First World War, iron coins were issued in the same denominations before cupronickel
was reintroduced in 1924, along with nickel 1 and 2 francs coins. The franc coins bore the inscription "Bon Pour", implying that they were tokens "good for" 1 or 2 francs. Such inscriptions also appeared on contemporary French and Belgian coins.
In 1929, Luxembourg's first silver coins since the late 18th century were issued, 5 and 10 francs. Bronze 5, 10 (smaller than earlier issues) and 25 centimes and nickel 50 centimes were introduced in 1930. The last coins before World War II
were cupronickel 25 centimes and 1 franc pieces issued in 1938 and 1939.
The first coins issued after the war were bronze 25 centimes and cupro-nickel 1 franc coins introduced in 1946. These were followed by cupronickel 5 francs in 1949. In 1952, the size of the 1 franc (€0.02) coin was reduced to match that of the Belgian 1 franc coin introduced in 1950. From this time on, all new Luxembourg coins matched the sizes and compositions of their Belgian counterparts, although the 25 centimes (€0.01) was not changed to match the Belgian coin introduced in 1964. In 1971, nickel 10 francs (€0.25) were introduced, followed by bronze 20 francs (€0.50) in 1980 and nickel 50 francs (€1.24) in 1987.
, Mark
and, occasionally, francs, with an exchange rate of 1 franc = 80 Pfennig (the relative gold standard
s would have implied a rate of 1 franc = 81 Pfennig) used on bi-currency notes.
In 1914, State Treasury notes were issued. The first series was denominated in francs and Mark but these were the last Luxembourg notes to feature the German currency. Denominations were of 1, 2, 5, 25 and 125 francs (80 Pfennig, 1.6, 4, 20 and 100 Mark). In 1919, a second series of State Treasury notes was issued, with new denominations of 50 centimes and 500 francs. In 1923, the International Bank in Luxembourg issued the first of several types of 100 francs notes which continued until the 1980s. In 1932, the state introduced 50 francs notes, followed by 1000 francs in 1940.
In 1944, following liberation, the franc was reintroduced with a new series of notes in denominations of 5, 10, 20, 50 and 100 francs. The 5 francs notes were replaced by coins in 1949, followd by the 10 francs in 1971, the 20 francs in 1980 and the 50 francs in 1987.
In 1985, the Monetary Institute of Luxembourg took over paper money issuance from the government and issued the first post-war 1000 francs notes {€24.79}. These were followed by 100 francs notes {€2.48} in 1986 and 5000 francs {€123.95} in 1993.
Currency
In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...
of Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
between 1854 and 1999 (except during the period 1941-44). The franc remained in circulation until 2002, when it was replaced by the euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...
. During the period 1999–2002, the franc was officially a subdivision of the euro (1 euro = 40.3399 francs) but the euro did not circulate.
Under the principle of "no obligation and no prohibition", financial transactions could be conducted in Euros and Francs, but physical payments could only be made in Francs, as Euro notes and coins were not available yet.
The franc was subdivided into 100 centimes.
History
The conquest of most of western Europe by Revolutionary and Napoleonic FranceFrance
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...
led to the French franc's
French franc
The franc was a currency of France. Along with the Spanish peseta, it was also a de facto currency used in Andorra . Between 1360 and 1641, it was the name of coins worth 1 livre tournois and it remained in common parlance as a term for this amount of money...
wide circulation, including in Luxembourg
Luxembourg
Luxembourg , officially the Grand Duchy of Luxembourg , is a landlocked country in western Europe, bordered by Belgium, France, and Germany. It has two principal regions: the Oesling in the North as part of the Ardennes massif, and the Gutland in the south...
. However, incorporation into the Netherlands
Netherlands
The Netherlands is a constituent country of the Kingdom of the Netherlands, located mainly in North-West Europe and with several islands in the Caribbean. Mainland Netherlands borders the North Sea to the north and west, Belgium to the south, and Germany to the east, and shares maritime borders...
in 1815 resulted in the Dutch gulden becoming Luxembourg's currency. Following Belgium's
Belgium
Belgium , officially the Kingdom of Belgium, is a federal state in Western Europe. It is a founding member of the European Union and hosts the EU's headquarters, and those of several other major international organisations such as NATO.Belgium is also a member of, or affiliated to, many...
independence from the Netherlands, the Belgian franc
Belgian franc
The franc was the currency of Belgium until 2002 when the euro was introduced into circulation. It was subdivided into centimes , 100 centiem or Centime .-History:...
was adopted in 1839 and circulated in Luxembourg until 1842 and again from 1848. Between 1842 and 1848, Luxembourg (as part of the German
Germany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
Zollverein
Zollverein
thumb|upright=1.2|The German Zollverein 1834–1919blue = Prussia in 1834 grey= Included region until 1866yellow= Excluded after 1866red = Borders of the German Union of 1828 pink= Relevant others until 1834...
) used the Prussia
Prussia
Prussia was a German kingdom and historic state originating out of the Duchy of Prussia and the Margraviate of Brandenburg. For centuries, the House of Hohenzollern ruled Prussia, successfully expanding its size by way of an unusually well-organized and effective army. Prussia shaped the history...
n Thaler
Thaler
The Thaler was a silver coin used throughout Europe for almost four hundred years. Its name lives on in various currencies as the dollar or tolar. Etymologically, "Thaler" is an abbreviation of "Joachimsthaler", a coin type from the city of Joachimsthal in Bohemia, where some of the first such...
.
In 1854, Luxembourg began issuing its own franc, at par with the Belgian franc. The Luxembourg franc followed the Belgian franc into the Latin Monetary Union
Latin Monetary Union
The Latin Monetary Union was a 19th century attempt to unify several European currencies, at a time when most circulating coins were still made of gold and silver...
in 1865. In 1926, Belgium withdrew from the Latin Monetary Union. However, the 1921 monetary union of Belgium and Luxembourg survived, forming the basis for the full Belgium-Luxembourg Economic Union
Belgium-Luxembourg Economic Union
The Belgium–Luxembourg Economic Union , abbreviated to BLEU or UEBL, is an economic and monetary union between Belgium and Luxembourg, two countries in the Benelux economic union....
in 1932. In 1935, the link between the Luxembourg and Belgian francs was revised, with 1 Luxembourg franc = 1¼ Belgian francs.
In May 1940, the franc was pegged to the German Reichsmark
German reichsmark
The Reichsmark was the currency in Germany from 1924 until June 20, 1948. The Reichsmark was subdivided into 100 Reichspfennig.-History:...
at a rate of 4 francs = 1 Reichsmark. This was changed to 10 francs = 1 Reichsmark in July, 1940. On 26 August 1940, the Reichsmark was declared legal tender in Luxembourg and on 20 January 1941, the Reichsmark was declared the only legal tender and the franc was abolished.http://www.globalfinancialdata.com/index.php3?action=showghoc&country_name=LUXEMBOURG The Luxembourg franc was reestablished in 1944, once more tied to the Belgian franc at par.
The Luxembourg franc was fixed at 1 euro = 40.3399 francs on 1 January 1999. Euro coins and banknotes were introduced on 1 January 2002. Old franc coins and notes lost their legal tender status on 28 February 2002.
Use of Belgian franc
Between 1944 and 2002, 1 Luxembourg franc was equal to 1 Belgian franc. Belgian francs were legal tender inside Luxembourg and Luxembourg francs were legal tender in Belgium. Nevertheless, payment with Luxembourg banknotes were commonly denied by shopkeepers in Belgium, either by ignorance or by fear that their other customers would refuse the banknotes (again, either by ignorance or fear of being denied payment with it later), forcing them to go through the hassle of a trip to their bank to redeem the value of the banknote.With a few early exceptions, the coins were identical in size, shape and composition. Although they had distinct designs, the coins circulated in both Luxembourg and Belgium.
Coins
The first coins were issued in 1854, in denominations of 2½, 5 and 10 centimes. In 1901, the bronze 5 and 10 centimes pieces were replaced by cupro-nickel coins. In 1915-1916, zinc 5, 10 and 25 centimes coins were issued by the occupying GermanGermany
Germany , officially the Federal Republic of Germany , is a federal parliamentary republic in Europe. The country consists of 16 states while the capital and largest city is Berlin. Germany covers an area of 357,021 km2 and has a largely temperate seasonal climate...
forces. After the First World War, iron coins were issued in the same denominations before cupronickel
Cupronickel
Cupronickel or copper-nickel or "cupernickel" is an alloy of copper that contains nickel and strengthening elements, such as iron and manganese. Cupronickel is highly resistant to corrosion in seawater, because its electrode potential is adjusted to be neutral with regard to seawater...
was reintroduced in 1924, along with nickel 1 and 2 francs coins. The franc coins bore the inscription "Bon Pour", implying that they were tokens "good for" 1 or 2 francs. Such inscriptions also appeared on contemporary French and Belgian coins.
In 1929, Luxembourg's first silver coins since the late 18th century were issued, 5 and 10 francs. Bronze 5, 10 (smaller than earlier issues) and 25 centimes and nickel 50 centimes were introduced in 1930. The last coins before World War II
World War II
World War II, or the Second World War , was a global conflict lasting from 1939 to 1945, involving most of the world's nations—including all of the great powers—eventually forming two opposing military alliances: the Allies and the Axis...
were cupronickel 25 centimes and 1 franc pieces issued in 1938 and 1939.
The first coins issued after the war were bronze 25 centimes and cupro-nickel 1 franc coins introduced in 1946. These were followed by cupronickel 5 francs in 1949. In 1952, the size of the 1 franc (€0.02) coin was reduced to match that of the Belgian 1 franc coin introduced in 1950. From this time on, all new Luxembourg coins matched the sizes and compositions of their Belgian counterparts, although the 25 centimes (€0.01) was not changed to match the Belgian coin introduced in 1964. In 1971, nickel 10 francs (€0.25) were introduced, followed by bronze 20 francs (€0.50) in 1980 and nickel 50 francs (€1.24) in 1987.
Banknotes
Before the First World War, notes were issued by the International Bank in Luxembourg and the National Bank, denominated in ThalerPrussian thaler
The Thaler was the currency of Prussia until 1857. From 1750, it was distinct from north German Reichsthaler unit of account in that it contained 1/14 of a Cologne mark of silver, rather than 1/12, and was minted as a coin...
, Mark
German gold mark
The Goldmark was the currency used in the German Empire from 1873 to 1914.-History:Before unification, the different German states issued a variety of different currencies, though most were linked to the Vereinsthaler, a silver coin containing 16⅔ grams of pure silver...
and, occasionally, francs, with an exchange rate of 1 franc = 80 Pfennig (the relative gold standard
Gold standard
The gold standard is a monetary system in which the standard economic unit of account is a fixed mass of gold. There are distinct kinds of gold standard...
s would have implied a rate of 1 franc = 81 Pfennig) used on bi-currency notes.
In 1914, State Treasury notes were issued. The first series was denominated in francs and Mark but these were the last Luxembourg notes to feature the German currency. Denominations were of 1, 2, 5, 25 and 125 francs (80 Pfennig, 1.6, 4, 20 and 100 Mark). In 1919, a second series of State Treasury notes was issued, with new denominations of 50 centimes and 500 francs. In 1923, the International Bank in Luxembourg issued the first of several types of 100 francs notes which continued until the 1980s. In 1932, the state introduced 50 francs notes, followed by 1000 francs in 1940.
In 1944, following liberation, the franc was reintroduced with a new series of notes in denominations of 5, 10, 20, 50 and 100 francs. The 5 francs notes were replaced by coins in 1949, followd by the 10 francs in 1971, the 20 francs in 1980 and the 50 francs in 1987.
In 1985, the Monetary Institute of Luxembourg took over paper money issuance from the government and issued the first post-war 1000 francs notes {€24.79}. These were followed by 100 francs notes {€2.48} in 1986 and 5000 francs {€123.95} in 1993.