Canadian Bank of Commerce, $5 and $20
Article by Don McLean


ver the course of the next few years, Canadian paper currency will be changing to Canadian plastic currency as the Royal Canadian Mint introduces the next generation of money, printed on plastic laminar. The change will bring two benefits: an increased lifespan for the notes, and increased security to prevent forgery. The graphics on today’s Canadian money are a complex layering of security features including holograms, watermarks and micro-printing, all designed to foil forgery attempts, and masked behind finely engraved portraits of past leaders and scenes from our nation.

Historically, however, the images on our paper currency were not just to make the note difficult to copy, they were designed to instill confidence in the issuing body.

Bank notes similar to what we use now first appeared in Canada in 1790 when the Canada Bank in Montreal issued currency, followed soon after by the Montreal Bank, the Quebec Bank, and after the War of 1812, the Bank of Upper Canada. In the hundred-plus years that followed, paper money was issued not just by banks, but also by corporations, municipalities and provinces. These various
bodies all fought to produce a successful currency
for one reason: there was money to be made by
making money. Clients would deposit land options,
agricultural futures and the like, in exchange for
the bank’s currency in order to conduct day-to-day
business. It was in essence an interest-free loan to
the bank, at a time when the lending rate was
about 6%. Generally the banks did a better job than
did government bodies. The banks’ issues were
backed by stores of gold and silver, and countersigned
by some of the most influential people of
the period. The government issues were often
backed by just two things, status and land.
Several times during the mid-nineteenth
century, the government of the new “Province of
Canada” fought for the sole right to make currency.

The government of the day was destitute and had
exhausted its credit with European banks and
moneylenders, and saw the making of currency as
an essential source of income. The clout of the
private banks and their backers however proved
too strong and the government was defeated
repeatedly in its attempts.
Throughout the second half of the nineteenth
century, the competition to issue a
successful currency was fierce, as banks came and
went, sometimes existing for only a few months.

A typical example was the Colonial Bank of
Canada, based in Toronto (see illustration). It
received its charter from the government in 1856.
Three years later, in 1859, the original owners sold
out and the new bankers immediately put out an
issue of notes. The International Bank of Canada,
formed in Cayuga, Ontario, only a year earlier, had
opened offices in Toronto at the end of 1858, but
by the end of 1859 it had collapsed. When the
public responded to this collapse by ‘running’ the
banks, the Colonial Bank also failed, in less than
six months after issuing its new currency. About
the same time, the major shareholder of the
International Bank, a man named Read, gained
control of the Clifton Bank, which was really just
the old Zimmerman Bank with a new name, and
in less than four years it too was gone.

Clients could sometimes redeem their paper
currency for a short period after a bank closed,
but often the depositors were left with nothing
but worthless bank notes. To attract business, the
various notes printed by banks and governments
were laden with graphic images designed to
create an impression of strength and permanence
in the issuing institution. Fine artisans created a
myriad of detailed engravings for the competing
currencies. Allegorical figures and royalty
conveyed a sense of history and long traditions;
scenes of industry and agriculture, or the bank
building itself, suggested strength and permanence;
and maps of Canada gave the impression of
a bank of great reach and power.

Classical imagery, as seen on the Canadian
Bank of Commerce $5 and $20 notes of 1935
suggested education, literary culture, prestige and
tradition, but how to explain the classical, draped,
nude figure of Mercury on the $5 note with his left
foot on the globe, caduceus in one hand, and
wearing a winged hat that looks suspiciously like a
fedora? On either side two female figures appear as
allegorical representations of the arts (left) and
transportation (right). On the $20 note, Neptune,
god of the sea, trident in hand, looks toward three
chastely arranged water nymphs perched on a rock
at the other side of the note. The skill of the
engraver/artist of these and other banknotes is
clearly evident, but not so his (or her) name. While
sculptors who create coins are often recognized,
the talented hands that produced elaborate and
detailed imagery for Canada’s early paper money
are, for the most part, unknown. A few names,
however, have come to light as a result of the more
thorough documentation of the physical production
of bank notes.

Many nineteenth-century Canadian notes
were produced by the British American Bank Note
Company (BABN), established in 1866,with William
Cumming Smillie as president and George Bull
Burland as manager. Two prestigious artists worked
for the company: Alfred Jones, a fine portrait
engraver, and Henry Earle, a designer and letter
engraver, who were responsible for much of the
BABN’s currency.

Another important firm was The American
Bank Note Company (ABN), a New York and Ottawa
based endeavour, the output of which included
notes for the Bank of Brantford and the Colonial
Bank (see illustrations). The ABN launched the
Canadian Bank Note Company (CBN) in 1897 (see
Bank of Commerce notes). After 1923 the ABN’s
moniker was dropped in favour of the Canadian
name. In the end, the CBN became the choice of
the Bank of Canada, and is still the printer of
Canadian currency.

As the nineteenth century drew to a close, the
frequency of bankruptcies waned. Just a few years
before Confederation, the government had finally
succeeded in restricting the banks to the production
of notes that were $4 or higher, while the
Dominion of Canada would produce the $1 and $2
notes. The banks now also had to pay a tax on all
their outstanding currencies. In 1881, the government
moved further by taking the ability to make
$4 notes away from the banks. This restriction was
followed by the Bank Act of 1890 which put in
place reserves to protect clients of failed banks. The
bankruptcies of the nineteenth century were
replaced with mergers and acquisitions as the
world moved to war in 1914. As the big banks got
bigger they absorbed the smaller firms, by either
friendly or unfriendly means, and slowly the names
now familiar today began to emerge. The Northern
Bank, the Commercial Bank of Windsor, the
Quebec Bank, and the Traders Bank of Canada were
absorbed by the Royal Bank, while The Molson’s
Bank, the Exchange Bank of Yarmouth, and others
ended up under the umbrella of the Canadian
Imperial Bank of Commerce.

The changes to banking brought innovations
to the design of bank notes. Images of war
machines, transportation and industry became
popular, and the flat green, ochre and red tones
common in the 1800s were replaced with new inks,
bright colours, and bold designs. With bank failure
less frequent, the banks put their efforts into the
battle against forgery. The engravings became
increasingly detailed. Fine artistry, powerful images
and multiple layers of colour created some of
Canada’s most beautiful money, exemplified by the
1917 and 1935 series produced by the Canadian Bank
of Commerce and discussed earlier.

Finally, in 1934, the Bank Of Canada was
formed. The other banks were given ten years to
reduce their note circulation, and the 1944
revisions to the Bank Act brought an end to any
other bank producing paper currency for use in
Canada. Today the early chartered bank notes are
favorites with collectors as they combine the rarity
of small printings, the unique history associated
with each bank, and the fine artistry of the
engraved images depicting a hundred years of life
in Canada. Decorated paper and ornamental
typefaces have persisted to this day, while classical
mythology has long since disappeared and regional
scenes have been replaced by nationally recognized
icons, such as The Famous Five (“Women Are
Persons”case), Northwest Coast Native art, or Roch
Carrier’s story of The Hockey Sweater.

Don McLean is head of the Jewellery and Numismatic
Department and a company director at Waddington’s
Auctioneers and Appraisers, Toronto.

Image: The Canadian Bank of Commerce,
$5 Canadian Bank Note Company, 1935
7.1 x 17.8cm

The Canadian Bank of Commerce, $20
Canadian Bank Note Company, 1935
7.1 x 15.2cm