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Dutch-Finnish Coin Swap (DNB-BOF)

Started by chrisild, September 23, 2009, 01:25:47 PM

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chrisild

Swapping coins is apparently not done by collectors only. Even central banks do it.

The Dutch central bank (DNB) has recently received a large number of 5 cent coins from Finland. In exchange, the DNB sent a bunch of €2 coins to the Bank of Finland (Suomen Pankki).

According to an article in the current issue of DNB Magazine, the Netherlands constantly struggle with a lack of 5 ct coins, while Finland has a similar problem with €2 pieces. So five trucks brought a total of 30 million "copper" coins from Finland to the Netherlands. The "swap" saved about 120 tons of metal.

The article says this was the first deal of its kind. Major retailers have "bought" euro and cent coins from other countries before (in 2004 for example the Metro group transferred a few million small coins from Austria to its stores in Germany), but it is apparently the first exchange involving two central banks ...

The article (in Dutch) can be found here:
http://www.dnb.nl/binaries/DNB%20magazine%20-%20september%202009_tcm46-221811.pdf (see page 5)

Christian

Figleaf

Another advantage of using euros.

For those few members who still don't speak Dutch ;)

Coin trade with Finland

The Netherlands' Central Bank has made a large scale swap of 2 euro coins against coins of 5 eurocent from Finland. Five lorries from Finland delivered thirty million pieces of five eurocent in the Netherlands; a European first.

The Netherlands faces an anual deficit of five eurocent coins. Finland, though, has a deficit of two euro coins, while the Netherlands has a large stock of these. The trade is not only cost saving, but it is also environmentally friendly. The swap saves about 120 000 kilograms of metal hat would otherwise have been needed for striking new coins.

Contrary to the production of banknotes, producing coins and managing coin stocks is still a national affair. The coin circultion in the Netherlands is a concern of the Netherlands' Central Bank, the Royal Dutch Mint, the Ministry of Finance and the European Commission.


This magazine spouts propaganda for the Bank. However, I think you can take it that the facts are correct. The beneficial influence on the environment is probably pretty limited in view of the transportation cost. More European co-ordination would have been a superior solution. This is just the optimum under the circumstances and a good precedent.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

chrisild

And since swapping was so much fun last year, they are doing it again. :)  This time the Dutch central bank (DNB) will ship 3 million €2 coins to Finland, and the Finnish central bank sends 30 million 5ct coins to the Netherlands. See http://www.dnb.nl/en/news-and-publications/news-and-archive/nieuws-2010/dnb230334.jsp for further details.

Christian

Figleaf

Curiously, I have yet to see a Finnish 5 cent in circulation here.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Sir Sisu

Interesting! I had not heard about this. In hindsight it's obvious that the estimates of coins needed when the transfer to the euro was made was miscalculated. From 2003-2009, Finnish production of the 5 cent has been at a relative minimum and we still have such a suprlus that we can get rid of them by the millions.  :P


Quote from: Figleaf on March 17, 2010, 12:47:39 AM
Curiously, I have yet to see a Finnish 5 cent in circulation here.

Peter

When you do, it's most likely to be dated 2001 or 2002. I can count on my fingers the amount of 5 cent coins that I have found in circulation with a date later than 2002.

Conversely I'm guessing that finding a 2001 €2 from the Netherlands shouldn't be too much of a problem in Finland.

chrisild

Quote from: Sir Sisu on March 26, 2010, 09:32:50 AM
Conversely I'm guessing that finding a 2001 €2 from the Netherlands shouldn't be too much of a problem in Finland.

That is something I have not quite understood yet. If the coins that are exchanged are from the central banks (as in "we made too many, and these have been sitting in our vaults for years"), then they should all be from Finland and the Netherlands respectively. But if the deal means, "we send you some of the pieces circulating here", the coins could be mixed as far as the country of origin is concerned ...

Christian

Sir Sisu

I'm guessing it could be a mix of both? But somehow I would assume that the majority is in large part due to an original surplus in production. I have no hard evindence on this, but to me it would seem logical: that there are large amounts of coins of those denominations sitting in the central banks that retail banks have not ordered. Why else would they be ready to exchange such large amounts of specific denominations? And looking at the mintage amounts for both coins for those years that I suggested, they are quite large relative to subsequent years.

SpaBreda

I think the Finnish 5 cents coins have arrived !
Found these in my change (in 3 different places) this weekend  :)

Paul.

Figleaf

All 2001. They must have been stored for years.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

Sir Sisu

Quote from: Figleaf on May 04, 2010, 03:08:25 PM
All 2001. They must have been stored for years.

Peter


As I suspected. I still find near unc samples of these (and a few other high mintage years in other denominations) in circulation. They are still slowly being released into circulation.

Figleaf

I guess the crisis made a dent in demand for coins, but even before that, there was a trend away from coins, with e-banking and debit cards getting more and more important. I carry cash only on trips abroad, but I have an assortment of cards. Maybe central banks underestimated the trend away from cash?

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

a3v1

Quote from: Figleaf on May 18, 2010, 01:59:02 PM
Maybe central banks underestimated the trend away from cash?
Peter,
That may be so, but doesn't explain the Dutch need for minting many millions of 5 cent pieces annually.
Regards,
a3v1
Over half a century of experience as a coin collector.
-------------
Money is like body fat: If there's too much of it, it always is in the wrong places.

Figleaf

As a rule of thumb, the lowest denomination actually in circulation sees the heaviest mintage, vide e.g. US cents. If all Dutch prices will occur equally often, there is a 50% chance that a price ends with a 5 and a 50% chance that it will end with a 0 (actually, there is a slightly higher chance that the price will end with a 5, because of €19.95 type pricing policies). Therefore, you need a 5 centimes in 50% of the transactions. Chances of needing any other coin are significantly lower.

This would of course also apply in Finland, but first the Central Banks must have made very different estimates and second, internet penetration is higher in Finland, due to sparse population, so e-banking and e-shopping are probably further advanced there.

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.

SpaBreda

I see it's been well over 2 years since I first found them in change.
I kept all the ones I found since then ....  :D

67 in total, 65 from 2001 , 2 from 2002 ....

I still find them from time to time ... most of them very shiny !

When I have a truck load of them, I might send them back .... just for a laugh  ;D

Paul.

Figleaf

Some look like they have made the trip all by themselves, rather than in one go by truck...

Peter
An unidentified coin is a piece of metal. An identified coin is a piece of history.