Comprehensive Financial History Report of Bermuda

Basic Information

• Country ISO Code: BM

• Official Language: English

• Language ISO Code: en

• Current Official Currency: Bermudian Dollar

• Currency ISO Code: BMD

Monetary History of Bermuda

Bermuda used the Bermudian pound as its currency until 1970. The Bermudian pound was equivalent to the British pound sterling and divided into 20 shillings, each with 12 pence. Bermuda decimalized in 1970, replacing the pound with the Bermudian dollar at a rate of $1 = 8 shillings 4 pence (equivalent to 100 pence), which was set equal to the US dollar.

• The Bermudian pound circulated alongside British sterling coins and local currency from the 19th century until 1970.

• Early Bermudian coins included the "hogge money" (1612–1624), copper pennies (1793), and standard British sterling coinage.

• Special commemorative silver crowns were issued in 1959 and 1964 featuring Bermudian designs.

• Bermuda resisted the widespread circulation of US currency in the 19th century, demonetizing silver dollars in 1876 and gold doubloons in 1882, maintaining sterling as the sole legal tender until 1970.

• The shift to the Bermudian dollar in 1970 aligned Bermuda’s economy more closely with the US, reflecting the importance of American tourism and trade.

• The Bermudian dollar was pegged to the US dollar at parity in 1972, a rate that remains today.

Coins

• The first Bermudian coins were issued between 1612 and 1624, known as "hogge money," featuring a pig on the obverse.

• Subsequent coins included copper pennies from 1793 and standard British sterling coins in the 19th century.

• Commemorative silver crowns were issued in 1959 (350th anniversary of settlement) and 1964 (featuring the coat of arms).

• The decimal coinage introduced in 1970 included denominations compatible with the US dollar system.

Banknotes

• The Bermudian dollar banknotes were first issued in 1970.

• Denominations include $2, $5, $10, $20, $50, and $100.

• Banknotes feature vibrant designs reflecting Bermuda’s culture, history, and maritime heritage, including the national flower (the Bermuda onion) and important landmarks.

• Bermudian law requires local businesses to price goods in Bermudian dollars, but US dollars are accepted at a 1:1 rate.

• Only banks are legally allowed to exchange Bermudian dollars into US dollars or other currencies, subject to a 1.25% Foreign Currency Purchase Tax.

Economic and Monetary Context

• Bermuda is a British Overseas Territory with its own parliament and currency.

• The Bermudian dollar’s peg to the US dollar facilitates trade and tourism, with about 75% of Bermuda’s tourism and trade originating from the United States.

• Despite the parity, the Bermudian dollar and US dollar are distinct currencies; credit card transactions and ATM withdrawals may incur international conversion fees.

• The currency system supports Bermuda’s economy, which relies heavily on American visitors and business.

Summary Table

This report provides a detailed overview of Bermuda’s monetary history, highlighting the transition from the Bermudian pound to the Bermudian dollar, its fixed peg to the US dollar, and its role in the island’s economic and cultural identity.

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