Finnish mark

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The markka (Finnish) or mark (Swedish) was the currency of Finland from 1860 until February 28, 2002, when it ceased to be legal tender and was replaced by the euro (€), introduced January 1. The currency code used for the markka was FIM, and the usual familiar notation was a postfix mk. It was divided into 100 penniä (Finnish) or penni (Swedish). The conversion for one euro was 5.94573 markkaa to the euro.

Contents 1 History 2 Names 3 Coins 4 Banknotes 5 Trivia 6 See also 7 References 8 External links

[edit] History

The markka was introduced in 1860, replacing the Russian ruble at a rate of four markka equal to one ruble. In 1865 the markka was separated from the Russian ruble and tied to the value of silver. After Finland gained independence in 1917, the Bank of Finland was founded and the markka was reintroduced as an independent currency backed by gold. The gold standard was abolished in 1940, and the markka suffered heavy inflation during the war years. In 1963 the markka was replaced by the new markka, equivalent to 100 old units.

Finland joined the Bretton Woods Agreement in 1948. Its value was pegged to the dollar at 3.20 mk/$ and devalued to 4.20 mk/$ in 1967. After the breakdown of the Bretton Woods agreement in 1971, a basket of currencies became the new reference. Occasionally, devaluation was used, 60% in total between 1975 and 1990. The paper industry was often blamed for demanding these devaluations to boost their exports. Various economic controls were removed and the market was gradually liberalized throughout the 1980's and the 1990's.

In 1992, Finland was hit by a severe recession. It was caused by several factors, the most severe being the incurring of debt, as the 1980's economic boom was based on debt. Also, Soviet Union had collapsed, which brought an end to the bilateral trade, and existing trade connections were severed. As a result, by some opinions years overdue, the artificial fixed exchange rate was abandoned and the markka was floated. [1] Its value immediately decreased 13% and the inflated nominal prices converged towards German levels. Also, as a result, several enterpreneurs who had borrowed money denominated in foreign currency suddenly faced insurmountable debt.

The Finnish markka was added into the ERM system in 1996 and then became a fraction of the euro in 1999, physical euro money arriving later in 2002. It has been speculated that if Finland had not joined the euro, market fluctuations such as the tech bubble would have reflected as wild fluctuations in the price of markka.

[edit] Names

The name "markka" was based on a medieval unit of weight. Both "markka" and "penni" are loanwords based on the same roots as the German Mark and pfennig.

Although the word "markka" predates the currency by several centuries, the currency was established before being named "markka". A competition was held for its name, and some of the other entries included "sataikko" (meaning "having a hundred parts"), "omena" (apple) and "suomo" (from "Suomi", the Finnish name for Finland).

With numbers, Finnish uses the partitive singular forms: "10 markkaa" and "10 penniä" (the singular is penni). In Swedish, the singular and plural forms of mark and penni are the same.

[edit] Coins

When the markka was introduced, coins were minted in copper (1, 5 and 10 penniä), silver (25 and 50 penniä, 1 and 2 markkaa) and gold (10 and 20 markkaa). After the First World War, silver and gold issues were ceased and cupro-nickel 25 and 50 penniä and 1 markka coins were introduced in 1921, followed by aluminium-bronze 5, 10 and 20 markkaa between 1928 and 1931. During the Second World War, copper replaced cupro-nickel in the 25 and 50 penniä and 1 markka, followed by an issue of iron 10, 25 and 50 penniä and 1 markka. This period also saw the issue of holed 5 and 10 penniä coins.

All coins below 1 markka had ceased to be produced by 1948. In 1952, a new coinage was introduced, with smaller iron (later nickel plated) 1 and 5 markka coins alongside aluminium-bronze 10, 20 and 50 markka and (from 1956) silver 100 and 200 markka denominations. This coinage continued to be issued until the introduction of the new markka in 1963.

The new markka coinage consisted initially of six denominations: 1 (aluminium), 5 (copper, later aluminium), 10 (aluminium-bronze, later aluminium), 20 and 50 penniä (aluminium-bronze) and 1 markka (silver, later cupro-nickel). From 1972, aluminium-bronze 5 markka were also issued.

The last series of Finnish markka coins included five coins:

• 10 penniä (silver-coloured) - a honeycomb on the reverse and a lily of the valley flower on the obverse
• 50 penniä (silver-coloured) - haircap moss on the reverse and a bear on the obverse
• 1 markka (copper-coloured) - the Finnish coat of arms on the obverse
• 5 markkaa (copper-coloured) - a lily pad leaf and a dragonfly on the reverse and a Saimaa seal on the obverse
• 10 markkaa (two-metal coin, copper-coloured centre and silver-coloured edge) - rowan tree branches and berries on the reverse and a wood grouse on the obverse

[edit] Banknotes

This section covers the last design series of the Finnish markka, designed in the 1980s by Finnish designer Erik Bruun and issued in 1986.

Denomination	Main colour	Reverse	Obverse	Notes
10 markkaa	Blue	Paavo Nurmi (1897–1973), athlete and Olympic winner	Helsinki Olympic stadium	Discontinued upon introduction of the 20 markkaa note
20 markkaa	Blue/green	Väinö Linna (1920–1992), author and novelist	Tammerkoski bridge	Introduced in 1993
50 markkaa	Brown	Alvar Aalto (1898–1976), architect	Finlandia house
100 markkaa	Green	Jean Sibelius (1865-1957), composer	Swans
500 markkaa	Red	Elias Lönnrot (1802-1884), historian	Forest hiking trail
1000 markkaa	Blue/purple	Anders Chydenius (1729-1803), priest and statesman	Kuninkaanportti gate in Suomenlinna
5000 markkaa	Red/purple	Mikael Agricola, priest and linguist	Turku castle	The note was never introduced. It was only a backup plan for inflation.

The second-to-last banknote design series, designed by Tapio Wirkkala, was introduced in 1955 and revised in the reform of 1963. It was the first series to depict actual specific persons. These included Juho Kusti Paasikivi on the 10 markkaa note, J. V. Snellman on the 100 markkaa note and Urho Kekkonen on the 500 markkaa note (introduced later).

Unlike Erik Bruun's series, this series did not depict any other real-life subjects, but only abstract ornaments in addition to the person depictions. A popular joke at the time was to cover Paasikivi's face except for his ear and back of the head on the 10 markkaa note, ending up with something resembling a mouse, said to be the only animal illustration in the entire series.

The still older notes, designed by Eliel Saarinen, were introduced in 1922. They also depicted humans, but these were generic men and women, and did not represent any specific persons. The fact that these men and women were depicted nude caused a minor controversy at the time.

[edit] Trivia

The Bank of Finland used a photograph of Väinö Linna on the 20 markka note without permission from copyright holders. This was only revealed after several million notes were in use. The Bank paid 100 000 mk (17 000 €) compensation to rights holders.^[1]

[edit] See also

• Bank of Finland
• Scandinavian Monetary Union
• Euro
• Finnish euro coins

[edit] References

1. ^ Luukka, Teemu. "Suomen Pankki maksoi korvauksia valokuvasta 17 000 euroa", HS, 2006-09-27. Retrieved on 2006-10-02. (in Finnish)

[edit] External links

• Overview of markka from the BBC
• Historical Finnish banknotes and coins at the Bank of Finland
• Pictures of banknotes
• Chronology of Finnish history
• History of the Finnish Markka (1860-2002)
• Annulled coins

Preceded by: Russian ruble

Finnish currency 1860-2002

Succeeded by: euro

Pre-euro and other EU currencies

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