A history of the Franc: the key moments

Author(s) : DELAGE Irène
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The birth of the "franc": the ordonnance of 5 December, 1360

Jean II Le Bon (John the Good) passed an ordonance creating the first 'franc' on 5 December, 1360. This gold coin or denier (3.885 grammes of 24 carat gold), showing the king on horseback, was minted as payment the ransom for the King held prisoner by Edward III, King of England, after the defeat at Poitiers, on 19 September, 1356.

The name 'franc' comes from the reasons for the making of the coins: “We have been released from prison, and we are 'franc' (autonomous) and released for ever”, said the King in his ordonance.
In the period thereafter up until the Revolution, other ordonances were passed instituting other coins: for example, in 1365, Charles V created the “franc à pied” (the standing franc), showing the monarch standing with a sword in his hand, and in 1422, Charles VII had a “franc à cheval” (a franc on horseback) struck of 3.059 grammes, in fact the last gold coin to be called the 'franc' ever minted.

By an ordonance of 31 May, 1575, Henri III created the “franc d'argent” (silver franc) (1575-1586 then 1591-1594). Henri IV minted quarter francs and half francs with his image on them, in line with the practice begun by Jean II Le Bon.

The Ancien Régime, the Revolution, and the appearance of paper money: the law of 28 Thermidor, An III (15 August, 1795)

The wars waged by Louis XIV left the country completely wasted, both economically and financially. And the resultant shortage of precious metals led to a shortage of coins in circulation, which in turn limited the production of new coins.
It was in this context that the regent, Philippe d'Orléans, appointed the Scot, John Law of Lauriston (1671-1729), as Controller General of Finances. In this capacity, Law founded the Banque générale privée (1716) (The General Private Bank), which developed the use of paper money, and then founded the Compagnie des Indes (The Company of the Indies) (23 May, 1719) with a monopoly of commerce on all the seas. The system however encouraged speculation in shares in 'The Company of the Indies' (the shares becoming a sort of paper currency) and inflation. Predictably, the 'bubble' burst at the end of 1720, when opponents of the financier attempted en masse to convert their notes into specie.
This collapse led to a complete rebuild of the money system in 1726, and Louis d'or (gold Louis) of 20 and 24 pounds were struck. However, whilst there was a certain monetary stability during the reigns of Louis XV and of Louis XVI, the same could not be said for the finnances. State debt rose threefold during the reign of Louis XVI. The necessity of finding funds in order to avoid bankruptcy and the calling of the Estates General threw France headlong in the torment of the Revolution and caused the fall of the Capetian monarchy.
With its back up against the wall, the newly founded Assemblée Constituante relaunched the principle of paper money, introducing semi-bond notes called 'assignats' in December 1789. A swift increase in their production was matched only by the note's rapid devaluation: in May 1791, 100 livres-papier (paper livres*) were only worth 73 livres espèces (coin livres), and one year later, the value had dropped to half and and then nearly a quarter of their previous value. Assignats were abandoned on 18 March, 1796, and demonetised on 4 February, 1797.
At the same time, there were laws passed regulating coinage. The law of 28 Thermidor, An III (15 August, 1795), stated that 'the unit of money shall from now on bear the name of franc. […] The composition of the coin shall be 9 parts silver and one part alloy; the one franc coin shall weigh 5 grammes.'

The ‘modern’ franc is born

Two years earlier, at the very beginning of the Revolutionary period, the Convention had imposed the decimal system upon the whole of France, 1 August, 1793, and decreed on 24 August that 'the monetary livre* will be subdivided into ten parts called 'décimes' [and] the décime shall be subdivided into ten parts called centimes'.

The Consulate and the Franc Germinal: the law of 7 Germinal, An XI

As for legislation concerning monetary matters, no fewer than seven laws were discussed, voted and promulgated in the period 18 Ventôse to 5 Messidor, An XI (9 March – 24 June, 1803). However, it was the law of 7 Germinal, An XI (28 March, 1803) which in the end was the most important. And despite the gathering war clouds, the political, economic and social context for this law were particularly favourable, most notably because of the Peace of Amiens of March 1802.
And yet, this law did nothing other than confirm the dispositions laid out in the law of 15 August, 1795. The fact is, the monetary situation during the Directory period had been particularly anarchic: there had been much clipping of coins (reducing the weight, and therefore value of the coin, despite its face value), some coins continued to circulate despite being too worn – the Directory even re-released coinage which had been removed for reason of wear-, other coins were debased. Worse still, coins that were no longer legal tender were being used, to say nothing of the presence of counterfeit coins, the free circulation of foreign currencies (notably shillings, Piedmontese and Swiss money), and an excess of copper coinage still being exchanged.
The Germinal law established the face-values of the silver and gold coins. The quarter-, half-, three-quarter-, one-, two- and five-franc pieces were to be in silver. The twenty- and forty-franc pieces were to be in gold. And with the weight of metal and alloy fixed, the unit of account corresponded identically to the actual value of the money. Similarly, the value ratio of silver/gold was set at 15:1. Some historians consider that this reference to both gold and silver indicates the creation of a bi-metallic system. Others (such as G. Thuillier) interpret the law as setting up of silver as the standard to which gold was subordinate, thus a monometallic system.
The first one franc piece minted according to the laws of 18 Germinal, An III (7 April, 1795) and 28 Thermidor, An III (15 August, 1795) was also the first in more than ten years to appear with an image of the head of state on it, namely that of the First Consul. On 18 Germinal, An XI, the last 5-franc ecus of the Dupré type were minted in Paris. 8 days later (26 Germinal/16 April), the first 5-franc pieces of the First Consul type were produced.
As for paper money, the law of 24 Germinal, (14 April, 1803) gave the Banque de France a fifteen-year monopoly for its distribution. But with the Law and Assignat disasters being still relatively fresh in the memory, such notes were reserved for significant transactions: the smallest value was set at a huge 500 francs. The law also reformed methods of checking for counterfeit and clipped coinage, etc.
In 1806, the Minister of Finance, Gaudin, asked for the canons taken at the Battle of Austerlitz to be melted down to make machines capable of making Germinal Francs: Napoleon accepted, and these minting presses were to be used for the following 150 years: and on them stood the inscription 'Brass taken from the enemy at Austerlitz'.

The franc during the 20th Century

Remarkably enough, the fall of the empire, the subsequent series of monarchichal regimes, and the Slump of 1847, did not weaken either the position of the franc or the role of Banque de France.
Furthermore, certain figures from the world of finance became key politicians of the days, such as the banker Laffite. And other continental countries based their currencies on the French system, with the Belgian Franc being created on 5 June, 1832, and the Swiss France on 7 May, 1850.
With the creation of the 2nd Republic, a law was passed on 15 March, 1848, instituting a Banque de Franque monopoly for the emission of notes for the new regime. Convertability of notes was however suspended in order to prevent run on coinage.
The economic success of the Second Empire was certainly encouraged by the stability of a monetary system that had been founded during the Convention, and then consolidated during the Consulate. The banking system was also updated under Napoleon III. Major banks were formed, and branch offices sprang up in the large provincial towns. Thus the Banque de France became a real national bank. In 1857, the first 50-franc notes appeared.
Towards 1850, significant amounts of gold were discovered in California and Australia. Since silver stocks remained stable, the bi-metallic system was upset. Several countries (but not France) reduced the amount of silver in their coins (from 900/1000 to 835/1000). Since international franc parity remained in place, people began using their debased francs to buy French francs as they were worth more, thus making a profit. In order to prevent this run on French francs, Napoleon III, in December 1856, encouraged and brought about the creation of the Latin Union. This was an attempt to bring unity to the weights and measures, and also to fix the exchange rates of silver and gold (whilst still keeping the names and national symbols for the national currencies), of the countries France, Belgium, Italy, and Switzerland. Greece was later to join in 1868.
Nor was France's monetary system unduly perturbed by the defeat at Sedan, which brought with it the fall of the Second Empire. Indeed, the bi-metallic crisis had been much more perilous than any political changes. There were however certain 'unofficial' effects. Some coins circulated with the emperor's head (sometimes made into a pig's) bearing a pointed hat with the inscription 'vampire de la France'.
But the renowned stability of the Germinal Franc was to last until 1914. After the Great War, the French currency suffered greatly because of foreign loans and the US refusal to wipe out war debts. Over the six-year period, 1918-1924, the franc lost 80% of its value. It such a catastrophic situation, the head of the government, Poincaré, appointed in the July of 1926, took drastic financial and budgetary measures, such as would (as he put it) allow the franc to climb back up in the exchange market.


* The French word livre (and the Italian word lira) comes from the Latin word libra, essentially a measurement of weight. The English word pound shows this clearly. Interestingly, the Latin word libra continued to live on in British usage hidden below the Germanic word pound, both in the pre-decimal expression l.s.d. (for pounds, shillings and pence, but in fact librae, solidi and denarii) and still today in the sign £, which is in fact a barred capital L, itself an abbreviation for Libra. The double sense of weight and value for livre arose because the coin's value was intrinsically related to its weight. Early coins were not in fact alloys but composed entirely of the precious metal in question, whether silver or gold. Given this situation, a paper equivalent of a gold or silver coin could be worth less than its coin counterpart, since the latter had the fundamental value of the precious metal whilst the paper had none.
- Kemp, T., Economic forces in French history, London: Dennis Dobson, 1971, 316 p., esp. pp. 66-106
- Price, R., An economic history of modern France, New York: Saint Martin's Press, 1981, 252 p.
- Lentz, T., 'La création du franc germinal, 28 mars 1803', Revue Napoléon, n° 13, janv-mars 2003, p. 47-52
Histoire du franc / éd. Jacques Demougin, Paris: Ed. du Layeur: Trésor du Patrimoine, 2003, 156 p.
A collector's web site: Le Franc.Net
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