Aust. Banknotes - Private Bank Issues

Lot 3039    Session 10 (7.30pm Wednesday)    Aust. Banknotes - Private Bank Issues

Estimate $20,000
Bid at live.noble.com.au
SOLD $18,000

THE GOVERNMENT OF QUEENSLAND, Queensland Treasury Note, specimen one pound, uniface, Treasury, Brisbane, Jany. 1st 1867, No., imprint of the Government Printing Office, Brisbane, 'Cancelled/G.W' hand written across front (MVR p197). Slight thinning at right edge on back having been pasted in a book, otherwise nearly uncirculated and of the highest rarity, one of only two known examples.

Modern-day Queensland was originally called Moreton Bay District of New South Wales. It became the Colony of Queensland on 10 December 1859. There were not enough resources in the young colony to finance over-ambitious railway and public works, and the government undertook heavy borrowing. The sale of Government Debentures was slow and the Union Bank indicated difficulty in continuing advances, and later refused any advances at all. However, the Oriental Bank, Sydney agency of Agra & Masterman's Bank, agreed to place a loan in London for £500,000. As a result of this arrangement the Union Bank agreed to advance funds, but the London firm of Overend & Gurney failed on 10 May 1866. Its failure also brought down Agra & Masterman's Bank and the contractor Peto, Brassey & Betts. The Union Bank then, without notice, took the unprecedented action of refusing to cash the Treasurer's cheques. This precipitated a crisis, for it meant that if no money was advanced by the banks, the government could not pay its labourers. A proposal was placed before Parliament to legislate for the issue of legal tender notes not convertible on demand. The proposed notes were highly criticised and they were dubbed 'Bell's Greenbacks' indicative of their inconvertibility. The Governor refused to approve their issue, as they were contrary to his Royal instructions. The Premier resigned, and an interim government took over on 20 July and lasted for 18 days. The interim government introduced and passed a Bill issuing £300,000 worth of Treasury Bonds. This measure brought some relief, but the Bank of Queensland failed, along with other investment companies. By August the Colony was in a financial crisis. The former Premier (Macalister) became Premier again, with J.C. McLean as Colonial Treasurer. On 18 September the Treasury Bills Act and the Treasury Notes Act were introduced. The notes were now to be convertible at the Treasury, but legal tender everywhere else in Queensland. The government believed its notes would be welcomed, because the failure of the Bank of Queensland had brought bank notes under suspicion, but Treasury Notes did not replace bank notes. The banks were hostile to the notes and promptly returned them to the Treasury, preferring to circulate their own notes. In 1867, a Select Committee of the Legislative Assembly inquired into the Treasury Note issue and recommended its withdrawal. By the time the notes were withdrawn in 1869, they were circulating widely and had been accepted by the public. Notes were issued from the Treasury in Brisbane, and also at Rockhampton and Bowen before they were retired. The design of the notes was engraved by Thomas Ham of Brisbane, and printed by the Government Printer on special paper from London. The notes were signed by the Colonial Treasurer, J.C.McLean and countersigned in the Note Issue Branch. Notes were issued in denominations of £1 and £5, and contained the imprint 'By AUTHORITY, Engraved and Printed at the Government Printing Office, Brisbane.' (Excerpt from Michael P. Vort-Ronald, 'Banks of Issue in Australia' p197-p198).