PREVIEW: BANKNOTES 25 AUGUST

Scotland’s attempt to monopolise the Atlantic to Pacific trade route across Panama ended in the Darien disaster of the 1690s. It cost the Scots around 20% of their circulating wealth and was a major factor leading to the 1707 Act of Union with England, which agreed to bail out the losses.

The company formed to manage the payments realised it had money over to invest and petitioned the king for approval to start a bank. In 1727 a royal charter duly allowed the establishment of the Royal Bank of Scotland.

The existing Bank of Scotland’s trading monopoly had already lapsed, creating the opportunity for the new Royal Bank to expand. However, instability, especially because of the 1745 Jacobite uprising, made this difficult. Eventually, as Edinburgh became the centre of the Enlightenment, the bank prospered, opening its first branch office, in Glasgow, in 1783, to help fund investment in the city’s burgeoning port and factories.

Six years before this initial expansion took place, the bank issued a One Guinea note, signed by two directors of the Royal Bank of Scotland. Charles Moore and James Simpson. Dated 1st September 1777 and carrying the serial number 857/297, it promised to pay Archibald Hope the sum listed on production of the note.

Hope was probably Sir Archibald Hope 9th Baronet (1735-94) who established the family seat at Pinkie House in Musselburgh, Edinburgh in 1778.

In very good to fine condition and rare, this is an example of a ‘Red Head Guinea’, the first tri-coloured note to be issued in Scotland and possibly in Europe.

“This is as much an historical document as it is a banknote,” says Noonans’ Head of Banknotes Andrew Pattison. “Politics and finance originally came together to shape the history of Scotland with the collapse of the Darien venture. The Royal Bank of Scotland was able to prosper as a shareholding company because the Scottish regional banking system was not restricted by the monopoly of the Bank of England, as institutions were south of the Border.

“The modern banking system has its origins in the days when this note was issued, and it is a fascinating reminder of those times.”

Noonans will offer the note in the Banknotes auction on 25 August with an estimate of £1,500-2,000.