The Austro-Hungarian Bank (german: Oesterreichisch-ungarische Bank, hu, Osztrák–Magyar Bank, cs, Rakousko-uherská banka, pl, Bank Austriacko-Węgierski, hr, Austro-Ugarska banka) was the

central bank A central bank, reserve bank, or monetary authority is an institution that manages the currency and monetary policy of a country or monetary union, and oversees their commercial banking system. In contrast to a commercial bank, a centra ...

of the

Habsburg Monarchy The Habsburg monarchy (german: Habsburgermonarchie, ), also known as the Danubian monarchy (german: Donaumonarchie, ), or Habsburg Empire (german: Habsburgerreich, ), was the collection of empires, kingdoms, duchies, counties and other polities ...

in the 19th and early 20th centuries. The institution was founded in 1816 as the privilegirte oesterreichische National-Bank (), and changed its name in 1878 as a delayed consequence of the

Austro-Hungarian Compromise of 1867 The Austro-Hungarian Compromise of 1867 (german: Ausgleich, hu, Kiegyezés) established the dual monarchy of Austria-Hungary. The Compromise only partially re-established the former pre-1848 sovereignty and status of the Kingdom of Hunga ...

. It was liquidated in the financial turmoil folloiwng the collapse of the Habsburg Monarchy in late 1918, and was principally succeeded by the

Oesterreichische Nationalbank The Oesterreichische Nationalbank (OeNB) is the central bank of Austria and, as such, an integral part of both the European System of Central Banks (ESCB) and the Eurozone. It started operations on , replacing the Austro-Hungarian Bank of whic ...

Vienna en, Viennese , iso_code = AT-9 , registration_plate = W , postal_code_type = Postal code , postal_code = , timezone = CET , utc_offset = +1 , timezone_DST ...

, the

Hungarian National Bank The Hungarian National Bank ( hu, Magyar Nemzeti Bank (MNB)) is the central bank of Hungary and as such part of the European System of Central Banks (ESCB). The Hungarian National Bank was established in 1924 and succeeded the Royal Hungarian St ...

Budapest Budapest (, ; ) is the capital and most populous city of Hungary. It is the ninth-largest city in the European Union by population within city limits and the second-largest city on the Danube river; the city has an estimated population o ...

, and the National Bank of Czechoslovakia in

Prague Prague ( ; cs, Praha ; german: Prag, ; la, Praga) is the capital and largest city in the Czech Republic, and the historical capital of Bohemia. On the Vltava river, Prague is home to about 1.3 million people. The city has a temperate ...

Background

The first note-issuing institution in the

was the Municipal Bank of Vienna or , established in 1705. It started issuing banknotes in 1762, which were known as "Bancozettel". During the

Napoleonic Wars The Napoleonic Wars (1803–1815) were a series of major global conflicts pitting the French Empire and its allies, led by Napoleon I, against a fluctuating array of European states formed into various coalitions. It produced a period of Fre ...

, the imperial Austrian government issued

paper money A banknote—also called a bill (North American English), paper money, or simply a note—is a type of negotiable promissory note, made by a bank or other licensed authority, payable to the bearer on demand. Banknotes were originally issued ...

of its own and rapidly increased its supply to finance the war effort, causing

inflation In economics, inflation is an increase in the general price level of goods and services in an economy. When the general price level rises, each unit of currency buys fewer goods and services; consequently, inflation corresponds to a reduct ...

Austrian Empire

After peace was restored by the

Congress of Vienna The Congress of Vienna (, ) of 1814–1815 was a series of international diplomatic meetings to discuss and agree upon a possible new layout of the European political and constitutional order after the downfall of the French Emperor Napoleon ...

, and on advice from statesman Johann Philipp Stadion, Emperor

Francis I Francis I or Francis the First may refer to: * Francesco I Gonzaga (1366–1407) * Francis I, Duke of Brittany (1414–1450), reigned 1442–1450 * Francis I of France (1494–1547), King of France, reigned 1515–1547 * Francis I, Duke of Saxe-Lau ...

established the privilegirte oesterreichische National-Bank by imperial

patent A patent is a type of intellectual property that gives its owner the legal right to exclude others from making, using, or selling an invention for a limited period of time in exchange for publishing an enabling disclosure of the invention."A ...

on . Its shareholders were private individuals. Its first task was the redemption of the depreciated wartime paper money to re-establish trust in the currency. On , it was granted another imperial patent to issue money by printing banknotes, and had its first permanent staff by January 1818. It soon started developing its network of branches throughout the Austrian Empire. On , Emperor Ferdinand I renewed the Bank's issuance monopoly, and on that occasion altered its governance to increase government control. The Bank opened its first branch in

in 1847, and its second in Pest in 1851. The Bank's notes suffered depreciation during the successive episodes of financial stress associated with the revolutions of 1848–1849, the Autumn Crisis of 1850 with

Prussia Prussia, , Old Prussian: ''Prūsa'' or ''Prūsija'' was a German state on the southeast coast of the Baltic Sea. It formed the German Empire under Prussian rule when it united the German states in 1871. It was ''de facto'' dissolved by an e ...

, and the

Crimean War The Crimean War, , was fought from October 1853 to February 1856 between Russia and an ultimately victorious alliance of the Ottoman Empire, France, the United Kingdom and Piedmont-Sardinia. Geopolitical causes of the war included the ...

mobilization from 1853 to 1856. On , Emperor

Franz Joseph I Franz Joseph I or Francis Joseph I (german: Franz Joseph Karl, hu, Ferenc József Károly, 18 August 1830 – 21 November 1916) was Emperor of Austria, King of Hungary, and the other states of the Habsburg monarchy from 2 December 1848 until ...

again renewed the Bank's issuance privilege, granted it greater independence, and emulated the UK

Bank Charter Act 1844 The Bank Charter Act 1844 (7 & 8 Vict. c. 32), sometimes referred to as the Peel Banking Act of 1844, was an Act of the Parliament of the United Kingdom, passed under the government of Robert Peel, which restricted the powers of British banks ...

by limiting the volume of banknotes in circulation to 200 million florins backed with precious metal. In 1866, however, the Austrian government breached these arrangements to finance the

Austro-Prussian War The Austro-Prussian War, also by many variant names such as Seven Weeks' War, German Civil War, Brothers War or Fraternal War, known in Germany as ("German War"), (; "German war of brothers") and by a variety of other names, was fought in 186 ...

, and had to subsequently pay compensation to the Bank.

Austro-Hungarian Empire

The matter of the central bank and its governance was set aside during the negotiations that led to the

, with the understanding that it would be reformed in the future. Meanwhile, the law of , based on the experience of 1866, stipulated that any money issues in excess of the 200 million florins limit must be backed by precious metal reserves. Backed by these provisions, the Bank managed to preserve monetary stability during the Austrian financial boom-and-bust episode of 1873. By 1875, it had 24 branches outside of Vienna. The adaptation of the bank's to the Monarchy's new political structure was only finalized in 1878, when its name was changed to Austro-Hungarian Bank. The bank was given a unitary governance with a general meeting (german: Generalversammlung) and governing council (german: Generalrat) chaired by a Governor, but a dual operating structure with two separate executive teams (german: Direktionen) and head offices (german: Hauptanstalten) in

Vienna en, Viennese , iso_code = AT-9 , registration_plate = W , postal_code_type = Postal code , postal_code = , timezone = CET , utc_offset = +1 , timezone_DST ...

and

. The governor was to be jointly nominated by the respective ministers of finance of

Austria Austria, , bar, Östareich officially the Republic of Austria, is a country in the southern part of Central Europe, lying in the Eastern Alps. It is a federation of nine states, one of which is the capital, Vienna, the most populous ...

and

Hungary Hungary ( hu, Magyarország ) is a landlocked country in Central Europe. Spanning of the Carpathian Basin, it is bordered by Slovakia to the north, Ukraine to the northeast, Romania to the east and southeast, Serbia to the south, Cr ...

, and the bank was statutorily committed to opening new branches on an equitable basis in both parts of the Habsburg Monarchy. Hungarian nationalists were not satisfied by these arrangements and kept advocating for a separate Hungarian central bank, but their efforts remained unsuccessful until the end of the joint monarchy. An 8-year transition from

bimetallism Bimetallism, also known as the bimetallic standard, is a monetary standard in which the value of the monetary unit is defined as equivalent to certain quantities of two metals, typically gold and silver, creating a fixed rate of exchange betw ...

to the

gold standard A gold standard is a monetary system in which the standard economic unit of account is based on a fixed quantity of gold. The gold standard was the basis for the international monetary system from the 1870s to the early 1920s, and from th ...

, replacing the

Austro-Hungarian florin The florin (german: Gulden, hu, forint, hr, forinta/florin, cs, zlatý) was the currency of the lands of the House of Habsburg between 1754 and 1892 (known as the Austrian Empire from 1804 to 1867 and the Austro-Hungarian Monarchy after 1867) ...

with the

Austro-Hungarian crown The crown (german: Krone, hu, korona, it, Corona, pl, korona, sl, krona, sh, kruna, cz, koruna, sk, koruna, ro, coroană) was the official currency of Austria-Hungary from 1892 (when it replaced the florin as part of the adoption of the ...

, was completed in 1900. Another renewal of the bank's issuance privilege, on , curtailed its prior independence. Even so, the Austro-Hungarian currency's gold parity was successfully maintained until 1914. During

World War I World War I (28 July 1914 11 November 1918), often abbreviated as WWI, was List of wars and anthropogenic disasters by death toll, one of the deadliest global conflicts in history. Belligerents included much of Europe, the Russian Empire, ...

, however, the Bank was unable to preserve monetary stability against the pressures of military expenses and economic shortages. The money supply increased thirteenfold, and prices rose sixteenfold compared to their prewar level. By late 1918, the real income of workers had been reduced to one fifth of what it had been in the last year of peace. About forty percent of the cost of war was covered by the central bank's monetary financing, and about sixty percent by war loans.

Dissolution

On , the

Diet of Hungary The Diet of Hungary or originally: Parlamentum Publicum / Parlamentum Generale ( hu, Országgyűlés) became the supreme legislative institution in the medieval kingdom of Hungary from the 1290s, and in its successor states, Royal Hungary and ...

voted to terminate the kingdom's union with Austria, and on , newly appointed

Prime Minister of Hungary The prime minister of Hungary ( hu, Magyarország miniszterelnöke) is the head of government of Hungary. The prime minister and the Cabinet are collectively accountable for their policies and actions to the Parliament, to their political part ...

Mihály Károlyi repudiated the Compromise of 1867. The Treaty of Saint-Germain-en-Laye, signed on , provided for the Bank's liquidation and the allocation of its assets and liabilities to successor states, namely Austria and Hungary but also

Czechoslovakia , rue, Чеськословеньско, , yi, טשעכאסלאוואקיי, , common_name = Czechoslovakia , life_span = 1918–19391945–1992 , p1 = Austria-Hungary , image_p1 ...

Italy Italy ( it, Italia ), officially the Italian Republic, ) or the Republic of Italy, is a country in Southern Europe. It is located in the middle of the Mediterranean Sea, and its territory largely coincides with the homonymous geographical ...

Poland Poland, officially the Republic of Poland, is a country in Central Europe. It is divided into 16 administrative provinces called voivodeships, covering an area of . Poland has a population of over 38 million and is the fifth-most populou ...

Romania Romania ( ; ro, România ) is a country located at the crossroads of Central Europe, Central, Eastern Europe, Eastern, and Southeast Europe, Southeastern Europe. It borders Bulgaria to the south, Ukraine to the north, Hungary to the west, S ...

, and

Yugoslavia Yugoslavia (; sh-Latn-Cyrl, separator=" / ", Jugoslavija, Југославија ; sl, Jugoslavija ; mk, Југославија ;; rup, Iugoslavia; hu, Jugoszlávia; rue, label= Pannonian Rusyn, Югославия, translit=Juhoslavij ...

. In Vienna, the Bank increasingly had recourse to monetary financing, and covered about 75 percent of the budget deficit of the new Republican Austrian state between 1918 and 1922. The Austrian currency depreciated sharply, from 16 to 30 crowns against the U.S. dollar during the first half of 1919 - and 5,275 crowns to the dollar by the end of 1921. The

hyperinflation In economics, hyperinflation is a very high and typically accelerating inflation. It quickly erodes the real value of the local currency, as the prices of all goods increase. This causes people to minimize their holdings in that currency as t ...

was only stopped by the protocol for the reconstruction of Austria, signed in

Geneva Geneva ( ; french: Genève ) frp, Genèva ; german: link=no, Genf ; it, Ginevra ; rm, Genevra is the second-most populous city in Switzerland (after Zürich) and the most populous city of Romandy, the French-speaking part of Switzerland. Situa ...

on and entailing a harsh fiscal and economic adjustment program supported by a loan guaranteed by the

League of Nations The League of Nations (french: link=no, Société des Nations ) was the first worldwide intergovernmental organisation whose principal mission was to maintain world peace. It was founded on 10 January 1920 by the Paris Peace Conference th ...

. The Bank's last ordinary general meeting was held on , and the last meeting of its governing council on .

Governors

* Ádám Nemes von Hídvég ( – ) * Joseph Carl von Dietrichstein ( – ) * Melchior von Steiner (acting, 1825 – 1830) * ( – ) * Carl Joseph Alois von Lederer ( – ; acting, – ) * Franz Xaver Breyer von Breynau ( – early 1848) * Josef Mayer von Gravenegg ( – ) * Joseph von Pipitz ( – ) * Alois Moser ( – ) * Gyula Kautz ( – ) *

Leon Biliński Chevalier Leon de Biliński (15 June 1846 in Zalischyky, Galicia, now Ukraine – 14 June 1923 in Vienna) was a Polish-Austrian statesman of the Biliński family. He had several important political functions in the Habsburg monarchy and indepen ...

( – ) * Sándor Popovics ( – ) * Ignaz Gruber von Menninger ( – ) *

Alexander Spitzmüller Alexander Spitzmüller (June 12, 1862 in Vienna, Austrian Empire – September 5, 1953 in Velden am Wörther See, Allied-occupied Austria) was an Austrian lawyer, bank director, and politician. In 1886, he entered the Austrian Ministry of Financ ...

( – December 1922)

Buildings

Vienna

At its creation, the Bank was temporarily settled at Singerstrasse 1 next to St. Stephen's Cathedral. In 1819–1821, it purchased houses on Vienna's prestigious Herrengasse, and replaced them after demolition with a building designed by Rafael von Riegel after designs by and . The new building was inaugurated by

on and completed in 1823. In 1860, the Bank moved across the street to a new building complex designed in 1855 by architect

Heinrich Ferstel Freiherr Heinrich von Ferstel (7 July 1828 14 July 1883) was an Austrian architect and professor, who played a vital role in building late 19th-century Vienna. Life The son of Ignaz Ferstel (17961866), a bank clerk and later director of the ...

, with ornate decoration including twelve statues by

Hans Gasser Hans Gasser (18171868) was an Austrian painter and sculptor. His name is sometimes spelled Hanns, and he was baptized as Johann. He shortened his name to avoid confusion with a now-forgotten Tyrolean artist who was also named Johann Gasser.Heinr ...

representing the lands of the Austrian Empire. The complex also hosted the

Wiener Börse The Wiener Börse AG (also known as the Vienna Stock Exchange) is a bourse situated in Vienna, Austria. The exchange also owns and operates the Prague Stock Exchange, provides market infrastructure to other exchanges in Central, Eastern, and ...

(which only stayed there until 1869), a commercial mall (german: Basarhof), and from its opening in 1876, the famed

Café Central Café Central is a traditional Viennese café located at Herrengasse 14 in the Innere Stadt first district of Vienna, Austria. The café occupies the ground floor of the former Bank and Stockmarket Building, today called the Palais Ferstel after ...

. In 1897, the Bank expanded into the adjacent on Freyung 1, where the Bank relocated its Austrian general management and the Governor's office. In 1924, in advance of its planned relocation, the Bank sold the entire complex to the

Anglo-Austrian Bank The Anglo-Österreichische Bank (), in shorthand Anglobank, was a bank founded in Vienna in 1863 with an extensive branch network in the Habsburg Monarchy and later in its successor states, primarily Austria and Czechoslovakia. Following the ...

, which redeveloped it for commercial use. The complex was comprehensively renovated in 1975–1982 and has been known since then as Palais Ferstel, including the recreation of the Café Central within the complex, albeit on a different location from the original. In 1910, the Bank held a design competition for the design of a new head office in Vienna's

Alsergrund Alsergrund (; Central Bavarian: ''Oisagrund'') is the ninth district of Vienna, Austria (german: 9. Bezirk, Alsergrund). It is located just north of the first, central district, Innere Stadt. Alsergrund was incorporated in 1862, with seven suburb ...

district, which was won by

Leopold Bauer Leopold Bauer (1 September 1872 – 7 October 1938) was an Austrian-Silesian architect. His work was part of the architecture event in the art competition at the 1936 Summer Olympics. Work The Petr Bezruč City House of Culture in Opava, which ...

, a disciple of celebrated Austrian architect Otto Wagner. Bauer's concept entailed a gigantic complex dominated by a massive 88-meter-high tower, partly on the location of the old

Vienna General Hospital The Vienna General Hospital (german: Allgemeines Krankenhaus der Stadt Wien), usually abbreviated to AKH, is the general hospital of the city of Vienna, Austria. It is also the city's university hospital, and the site of the Medical Unive ...

(later Campus Hof 1 of the

University of Vienna The University of Vienna (german: Universität Wien) is a public research university located in Vienna, Austria. It was founded by Duke Rudolph IV in 1365 and is the oldest university in the German-speaking world. With its long and rich hi ...

). The construction of a first building intended for money printing facilities started in 1913 after demolition of the barracks, but was disrupted by World War I and stopped in 1917; the rest of Bauer's grandiose development plan was never implemented. After the war's end, the unfinished printing building was repurposed on a design by the Bank's architects and . It was completed in 1925 to host the

, just weeks ahead of the introduction of the new currency, the

Austrian schilling The schilling (German: ''Schilling'') was the currency of Austria from 1925 to 1938 and from 1945 to 1999, and the circulating currency until 2002. The euro was introduced at a fixed parity of €1 = 13.7603 schilling to replace it. The schil ...

. Gezicht op het gebouw van de Oostenrijkse Nationale Bank in Wenen National Bank (titel op object), RP-P-2018-920.jpg, 1820s engraving of the Bank building on Herrengasse Herrengasse Vienna October 2006 001.jpg, The same building in 2006 BERMANN(1880) p1104 Herrengasse.jpg, The Bank complex inaugurated in 1860, pictured in 1880 Rudolf von Alt Palais Ferstel.jpg, The Bank complex, engraving after

Rudolf von Alt Rudolf Ritter von Alt (; 28 August 1812 – 12 March 1905) was an Austrian landscape and architectural painter. Born as Rudolf Alt, he could call himself von Alt and bear the title of a Ritter (knight) after he gained nobility in 1889. Biogra ...

Palais Ferstl Vienna June 2006 112.jpg, Entrance of the Bank complex on the Freyung square, 2006 Wien - Donaunixenbrunnen.jpg, fountain placed in the Bank complex in 1861 Palais Hardegg- Freyung 1.JPG, Palais Hardegg on Freyung 1 ÖNB Vienna June 2006 562 corrected perspective.jpg, New Nationalbank building, started as printing facilities of the Austro-Hungarian Bank, 2006

Budapest

The new Budapest head office building of the Austro-Hungarian Bank was inaugurated in 1905, and later hosted the

. It was designed by architect Ignác Alpár, with sculpture by József Róna and . Its interiors were much altered after

World War II World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the World War II by country, vast majority of the world's countries—including all of the great power ...

; a major renovation was undertaken in 2021, with the aim to reopen the building by the National Bank's 100th anniversary in 2024. Szabadság tér, Osztrák-Magyar Bank (ma Magyar Nemzeti Bank). A kép forrását kérjük így adja meg- Fortepan - Budapest Főváros Levéltára. Levéltári jelzet- HU.BFL.XV.19.d.1.08.120 Fortepan 82645.jpg, Budapest head office at the time of its inauguration, 1905 Magyar Nemzeti Bank épületének nyugati homlokzata. - 2009, Budapest.jpg, The same building in 2009 Symbol of the Hungarian National Bank by József Róna, 2016 Budapest.jpg, Allegory of the Bank, by József Róna

Branches

By 1914, the Austro-Hungarian Bank had 104 branches and 179 local offices throughout the Monarchy. Politických vězňů 7, Hospodářský ústav AV ČR.jpg,

Schebek Palace Schebek Palace ( cs, Schebkův palác), otherwise known as "The House of the Angel", is a neo-renaissance building located at Politických vězňů 7, čp. 936/II, in New Town, Prague 1. It is protected as a cultural monument in the Czech Repu ...

, the Bank's branch building in

from 1890 Karlovy Vary bývalá Komerční banka (02).jpg, in

Karlovy Vary Karlovy Vary (; german: Karlsbad, formerly also spelled ''Carlsbad'' in English) is a spa town, spa city in the Karlovy Vary Region of the Czech Republic. It has about 46,000 inhabitants. It lies on the confluence of the rivers Ohře and Teplá. ...

, 2021 Rzeszow. Bank Austr.- wegierski i Kasa oszczednosci - Osterreich-ungarische Bank und Sparkasse. 1915 (70885481).jpg, Former branch in

Rzeszów Rzeszów ( , ; la, Resovia; yi, ריישא ''Raisha'')) is the largest city in southeastern Poland. It is located on both sides of the Wisłok River in the heartland of the Sandomierz Basin. Rzeszów has been the capital of the Subcarpathian Vo ...

, 1915 8, Lystopadovoho Chynu Street, Lviv (2).jpg, Former branch in

Lviv Lviv ( uk, Львів) is the largest city in western Ukraine, and the seventh-largest in Ukraine, with a population of . It serves as the administrative centre of Lviv Oblast and Lviv Raion, and is one of the main cultural centres of Ukraine ...

, 2011; redeveloped since then as ''Bankhotel'' Österreichisch-ungarische Bank Bozen - Ötzimuseum.JPG, Former branch in

Bolzano Bolzano ( or ; german: Bozen, (formerly ); bar, Bozn; lld, Balsan or ) is the capital city of the province of South Tyrol in northern Italy. With a population of 108,245, Bolzano is also by far the largest city in South Tyrol and the third la ...

, 2012 Facciata principale angolo via Geppa.jpg, in

Trieste Trieste ( , ; sl, Trst ; german: Triest ) is a city and seaport in northeastern Italy. It is the capital city, and largest city, of the autonomous region of Friuli Venezia Giulia, one of two autonomous regions which are not subdivided into provi ...

, 2018 13451-Szatmar-Nemeti-1911-Osztrak- Magyar bank fiokintezete-Brück & Sohn Kunstverlag.jpg, Former branch in

Satu Mare Satu Mare (; hu, Szatmárnémeti ; german: Sathmar; yi, סאטמאר or ) is a city with a population of 102,400 (2011). It is the capital of Satu Mare County, Romania, as well as the centre of the Satu Mare metropolitan area. It lies in the ...

, 1911 Balázs tér (Bulevardul Ion C. Brătianu), az Osztrák-Magyar Bank (ma Román Nemzeti Bank) székháza. Fortepan 86656.jpg, Former branch in

Timișoara ), City of Roses ( ro, Orașul florilor), City of Parks ( ro, Orașul parcurilor) , image_map = Timisoara jud Timis.svg , map_caption = Location in Timiș County , pushpin_map = Romania#Europe , pushpin_ ...

, 1910 Ulica Štrosmajerova - Ulica Vuka Karadžića sarok, az Osztrák-Magyar Bank kirendeltsége (ma is egy biztosítótársaság épülete). Fortepan 86683.jpg, Former branch in

Pančevo Pančevo (Serbian Cyrillic: Панчево, ; german: Pantschowa; hu, Pancsova; ro, Panciova; sk, Pánčevo) is a city and the administrative center of the South Banat District in the autonomous province of Vojvodina, Serbia. It is located on ...

, 1904 Austrougarska banka.jpg, Former branch in

Zrenjanin Zrenjanin ( sr-Cyrl, Зрењанин, ; hu, Nagybecskerek; ro, Becicherecu Mare; sk, Zreňanin; german: Großbetschkerek) is a List of cities in Serbia, city and the administrative center of the Central Banat District in the autonomous pro ...

, 2015 BOR Bank in Sarajevo.JPG, in

Sarajevo Sarajevo ( ; cyrl, Сарајево, ; ''see Names of European cities in different languages (Q–T)#S, names in other languages'') is the Capital city, capital and largest city of Bosnia and Herzegovina, with a population of 275,524 in its a ...

, 2012

References

{{reflist Former central banks Defunct banks of Austria