Comprehensive Financial History Report of The Bahamas

Basic Information

• Country ISO Code: BS

• Official Language: English

• Language ISO Code: en

• Current Official Currency: Bahamian Dollar

• Currency ISO Code: BSD

Monetary History of The Bahamas

Previous Currency: Bahamian Pound

• Until 1966, The Bahamas used the Bahamian Pound, equivalent to the British Pound Sterling.

• The pound was subdivided into 20 shillings, each with 12 pence.

• Coins and banknotes of the British Pound circulated, alongside a local penny coin minted in 1806.

• The pound was replaced by the Bahamian dollar in 1966.

Introduction of the Bahamian Dollar (BSD)

• On May 25, 1966, the Bahamian dollar replaced the Bahamian pound at a rate of 1 dollar = 7 shillings (approximately US$0.98).

• The dollar is subdivided into 100 cents.

• Initially issued by a currency board (1916–1974), banknotes were issued by the Government of The Bahamas (1869–1968), the Bahamian Monetary Authority (1968–1974), and since 1974 by the Central Bank of The Bahamas.

• The Bahamian dollar maintains a fixed parity with the US dollar at 1 BSD = 1 USD, facilitating the circulation and acceptance of both currencies.

Coins

• Introduced in 1966 in denominations of 1, 5, 10, 15, 25, 50 cents, and 1 and 2 dollars.

• Early coins were made of nickel-brass, cupronickel, nickel, and silver (silver coins discontinued after 1966).

• The 10-cent coin was scalloped, and the 15-cent coin was square-shaped.

• The 1-cent coin was discontinued in 2020, with cash transactions rounded to the nearest 5 cents.

• Designs feature the Bahamian Coat of Arms and cultural symbols such as starfish (1 cent), pineapple (5 cents), fish (10 cents), hibiscus (15 cents), and native sloops (25 cents).

Banknotes

• Denominations include $1, $3, $5, $10, $20, $50, and $100.

• The $3 bill was created to ease decimalization, as three dollars approximately equaled one pound.

• Banknotes feature portraits of Queen Elizabeth II and national symbols.

• The Central Bank of The Bahamas issues and maintains the security of banknotes.

Economic and Monetary Context

• The Bahamas’ economy heavily relies on tourism and financial services.

• Maintaining parity with the US dollar facilitates trade and investment due to close economic ties with the United States.

• The Central Bank uses reserve requirements, credit controls, and discount rates to maintain monetary stability.

• In 2020, The Bahamas launched the Sand Dollar, the world’s first legal digital currency, as a digital alternative to the traditional Bahamian dollar.

Summary Table

This report provides a detailed overview of The Bahamas’ monetary history, highlighting the Bahamian dollar as the official currency pegged to the US dollar, the introduction of the Sand Dollar digital currency, and the cultural and economic significance of its coins and banknotes.