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Last Updated: Tuesday, 30 May 2006, 09:07 GMT 10:07 UK
Opening the bank
By Sean Coughlan
BBC News Magazine

The Bank of England is a familiar name and institution. But how much do you know about the building and its cavernous bullion vaults?

Bank of England
This was the world's first purpose-built bank

There can't be many more well-established institutions in the country than the Bank of England.

The name is on the banknotes, it's given its name to a tube station and every month its decisions over interest rates affect how much we're going to pay on our mortgages.

But the inside of this landmark building remains relatively unknown, a slice of hidden London.

That isn't entirely accidental. Because large parts of the bank are underground, storing bank notes and gold. When you step inside the bank, below your feet is, the bank claims, the second biggest concentration of gold bullion on the planet.

In an attempt to give the public a better understanding of the Old Lady of Threadneedle Street, the bank has re-launched its in-house museum, explaining its own history and the development of central banking.

But what about that bullion? The bank says it has 400 tonnes of UK government gold stored - but it won't say how much else is under lock and key in its vaults, including the gold reserves of other countries.

Behind bars

You can try to imagine the bullion bars down below, each 13kg chunk of metal worth about 158,000, stacked no more than three high so as not to damage the bars. But given the security sensitivity, you're not exactly going to get a guided tour and a slide show.

BANK NOTES
20 note
The bank opened in 1694, renting premises in Cheapside
The nickname "Old Lady of Threadneedle Street" first recorded in a 1797 cartoon.
The symbol is from the letter L for "libra", Latin for pound
The chief cashier's signature appeared on notes in 1870
The bank was nationalised in 1946
The monarch first appeared on Bank of England notes in 1960
1997 government gave bank control over interest rates

The identity of staff who work in the bullion vaults is also now a security matter, after concerns about "tigernapping", where relatives of bank employees are held hostage.

The bank is a much bigger building than first appearances suggest. Above ground, it occupies three and half acres, crammed into the heart of the City of London.

And the area below ground, which includes three disused wells, has more floorspace than the City's tallest building, Tower 42 (formerly the NatWest Tower).

As well as banking halls, offices and vaults, it has its own state rooms and a private garden. And when in the 18th Century, an abnormally tall employee died, he was buried in the garden to prevent his corpse being stolen by body-snatchers wanting unusual specimens to sell to surgeons.

There is a honeycomb of tunnels running below the City streets - and part of the folklore of the bank is that in the 1830s the directors were summoned to a meeting in the vaults in the middle of the night by a sewerman who had found a way into the building.

Forgeries

The bank moved into its current location in 1734, in what was then the world's first purpose-built bank. It is built on a defensive island site, with a curtain wall, no other connecting buildings and with no windows on the ground floor.

Dan Rogers/Bank of England Museum
The bank's museum shows a 4th Century Roman gold bar

Until 1973, security was a highly visible presence, when a troop of soldiers wearing bearskins marched into the bank each night.

Apart from a fear of robbery, the other great threat to a bank is forgery. Until 1832, this was robustly discouraged by hanging not only the forgers but anyone trying to spend the dodgy notes.

And the museum has examples of forgeries over the centuries, including those produced by inmates in Nazi concentration camps, which were intended to destabilise the UK's wartime economy.

Forgery detection was even more complicated in the 19th Century when the Bank of England didn't have a monopoly over producing notes. There were rival local banks - and the museum has notes from the Bank of Pontefract, Andover Old Bank and the Weald of Kent Bank.

Banks are about trust. And the museum records how the Bank of England faced various financial panics, such as the run on the bank prompted by a French invasion scare in 1797, which depleted stocks of gold from 16m to 2m.

Despite such slips, the new museum ably reinforces the image, in that canny piece of sloganeering, that the country's assets are "as safe as the Bank of England".


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