This large and visually impressive, limited edition collectible is a high quality replica of the highest denomination banknote ever issued by the Dominion of Canada. While original notes were printed on high security banknote paper, this collector re-creation is engraved and struck in ten ounces of .9999 fine silver, including full colour raised micro-engraved printing. The note has a $50,000 nominal denomination and bears the original issue date of 1924. It is the actual size of the original note, which is significantly larger than regular banknotes, measuring 194 mm x 118 mm (about 7.6 inches x 4.6 inches). Mintage is limited to just 275 pieces.
This type of note is referred to as a "bank legal” since they were only legal for payment by chartered banks and could not be acquired or used by individuals. Denominations included $500, $1,000, $5,000 and $50,000. Issue dates on the notes are 1896, 1901, 1918 and 1924, with the notes in continuous use until the Bank of Canada was formed in 1934.
In 1924, $50,000 would have had a purchasing power equivalent to about $900,000 today, making this type of note impractical for individuals. But they served two important purposes at the time. Firstly, banks were required under the Bank Act to hold a certain value of gold and/or Dominion of Canada government issued banknotes. Bank legals met the requirements of the Bank Act without having to hold large quantities of low value notes.
The second purpose was one of convenience at a time long before the advent of electronic money transfers. Each day, the chartered banks needed to reconcile cash balances primarily related to cheques being cashed. While individuals used coins and small denomination notes for daily commerce, net balances between large financial institutions could be balanced much more efficiently through the use of notes up to $50,000.
All issued bank legal notes were redeemed by the chartered banks shortly after the formation of the Bank of Canada in 1934, and only samples overprinted "specimen” or one-sided proofs have survived in private hands. This collector issue is also marked "specimen”, confirming it cannot be used as currency of Canada.
