Page "Bank of England" Paragraph 24

Until the mid-nineteenth century, commercial banks in Britain were able to issue their own banknotes, and notes issued by provincial banking companies were commonly in circulation.

The Bank Charter Act 1844 began the process of restricting note issue to the Bank of England ; under this act, new banks were prohibited from issuing their own banknotes and existing note-issuing banks were not permitted to expand their issue.

As provincial banking companies merged to form larger banks, they lost their right to issue notes, and the English private banknote eventually disappeared, leaving the Bank of England with a monopoly of note issue in England and Wales.

The last private bank to issue its own banknotes in England and Wales was Fox, Fowler and Company in 1921.

However, the limitations of the 1844 Act only affected banks in England and Wales, and today three commercial banks in Scotland and four in Northern Ireland continue to issue their own sterling banknotes, regulated by the Bank of England.