Bahraini dinar

History

The Bahraini dinar was introduced in 1965, replacing the Gulf rupee at a rate of 10 rupees = 1 dinar = 15 shillings ( pound) sterling. Bahrain did not follow India's devaluation of the rupee in 1966 or sterling's devaluation in 1967. Bahraini coins and notes were introduced at that time.

Initially, Abu Dhabi adopted the Bahraini dinar but changed to the dirham in 1973, with 1 dirham = 100 fils = 0.100 dinar.

Exchange rate

In December 1980, the dinar was officially pegged to the IMF's special drawing rights (SDRs). In practice, it is fixed at $1 USD = 0.376 BHD, which translates to approximately 1 BHD = US$2.65957 and, consequently, just over 9.9734 Saudi Arabian riyals. This rate was made official in 2001 via Decree (48) Article 1, and Saudi riyals are accepted at all points of sale in Bahrain at 10 to 1, with the exception of the Saudi 500 riyal note which is only accepted in major supermarkets, airports and electronic shops.

Before Malta's adoption of the euro on 1 January 2008, it was the third-highest-valued currency unit after the Kuwaiti dinar and Maltese lira. After Malta adopted the euro, the dinar became the second highest-valued currency unit.

note=Rates obtained from these websites may contradict with pegged rate mentioned above}}

Coins

In 1965, coins were introduced in denominations of 1, 5, 10, 25, 50 and 100 fils. The 1, 5 and 10 fils were struck in bronze, with the others in cupro-nickel. The 1 fils coin was not produced after 1966 and no longer circulates. A bimetallic 100 fils coin was introduced in October 1992. In 1992, brass replaced bronze in the 5 and 10 fils.

A bimetallic 500 fils coin was released in 2000 with the Pearl Monument on the obverse. It was minted only until 2002 but continued to circulate. In response to the uprising in Bahrain, which resulted in the demolition of the monument on 18 March 2011, the 500 fils coin started to gradually disappear from circulation as it was no longer released back into circulation after reaching banks. The coins remain legal tender.

For a wider history surrounding currency in the region, see British currency in the Middle East.

First issue

Second issue

Banknotes

On 16 October 1965 the Bahrain Currency Board introduced notes in denominations of , , 1, 5 and 10 dinars; a 100-fils note was introduced on September 2, 1967.

In 1973, the Bahrain Monetary Agency took over the issuance of paper money, and starting in July 1978 with a 20 dinar note, it introduced a new family of notes dated 1973 in Arabic. Denominations of , 1, 5 and 10 dinars were released on 16 December 1979. The 100-fils note of the Bahrain Currency Board was withdrawn in November 1980 and the remainder of the notes were withdrawn on 31 March 1996, remaining exchangeable until one year afterwards.

The third issue of notes (the second by the Bahrain Monetary Agency) with the same denominations of to 20 dinars was released in March 1993. This series was upgraded during 1998 with various modifications to colour and security features. However, a fake order for banknotes had recently been placed with the Argentinian printer Ciccone Calcografica who did not verify it with the legitimate authorities in Bahrain and obtained genuine banknote paper from Arjo Wiggins to print over 7 million unauthorised replicas of the 20-dinar note (of the 1993 design), equivalent to US$365 million. These differed from genuine notes in two respects: different background shading to the Arabic name of the Bahrain Monetary Agency, and a large gap between the two Arabic letters in the horizontal serial number. These unauthorised notes were smuggled through various African and European countries by air and presented for exchange in Belgium, Switzerland and the Gulf around June 1998, just as the upgraded 20-dinar note was being released in Bahrain. The large amounts raised suspicions and were soon detected as notes that had not been printed by the authorised printer, De La Rue. The Bahrain Monetary Agency allowed individuals who had mistakenly accepted the unauthorised notes to exchange them for face value at banks between 8–14 June 1998, then quickly recalled all 20-dinar notes on 30 July 1998. The unauthorised notes, being replicas of the 1993 design, were in purple and without a hologram. Despite this the upgraded June 1998 notes, also in purple but with a hologram were also withdrawn. On 1 August 1998 a new 20-dinar note, of the same design as the upgraded note (with a hologram) but in peach colour, was released. Thus, the genuine June 1998 design was only in circulation for about 7 weeks and is therefore rarely seen by collectors. All other banknotes of the Bahrain Monetary Agency remain exchangeable.

On 7 September 2006, the Bahrain Monetary Agency was renamed the Central Bank of Bahrain. On 17 March 2008, the Central Bank of Bahrain introduced its first series of notes (Bahrain's 4th series) reflecting the country's heritage as well as its modern development.

On 4 September 2016, the Central Bank of Bahrain introduced upgraded versions of the 10- and 20-dinar notes with enhanced security features (SPARK and Motion thread) and tactile lines added at center right front for the visually impaired.

References

Sources

References

1. "Monetary Policy {{!}} CBB".
2. "The Banknotes of Bahrain".
3. (March 15, 2012). "Central Bank of Bahrain - Current Coins 500 Fils".
4. "Bahrain coin may become collector's item".
5. "Current Coins | CBB".
6. (2011). "The Banknote Book". www.BanknoteNews.com.
7. "Central Bank of Bahrain - Third Issue (1993)".
8. "Página/12".
9. "Bahrain - 20 Dinar Notes".
10. "Archived copy".
11. "Bahrain new 10- and 20-dinar notes (B309, B310) reported".
12. "Upgraded BD20 & BD10 of fourth issue 2016".
13. "Fourth issue (2008) | CBB".