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Finnish mark

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The Finnish markka was the currency
Currency
In economics, currency refers to a generally accepted medium of exchange. These are usually the coins and banknotes of a particular government, which comprise the physical aspects of a nation's money supply...

 of Finland
Finland
Finland , officially the Republic of Finland, is a Nordic country situated in the Fennoscandian region of Northern Europe. It is bordered by Sweden in the west, Norway in the north and Russia in the east, while Estonia lies to its south across the Gulf of Finland.Around 5.4 million people reside...

 from 1860 until 28 February 2002, when it ceased to be legal tender. The markka was replaced by the euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...

 (€), which had been introduced, in cash form, on 1 January 2002.

The markka was divided into 100 pennies , postfixed "p"). At the point of conversion, the rate was fixed at one euro worth approximately equal to six markka, or precisely €1 = 5.94573 mk.

History


The markka was introduced in 1860 by the Bank of Finland
Bank of Finland
The Bank of Finland is the central bank of Finland. It is the fourth oldest central bank in the world.-History:The Bank of Finland was established on 1 March in 1812 in the city of Turku by Alexander I of Russia. In 1819 it was relocated to Helsinki...

, replacing the Russian ruble
Russian ruble
The ruble or rouble is the currency of the Russian Federation and the two partially recognized republics of Abkhazia and South Ossetia. Formerly, the ruble was also the currency of the Russian Empire and the Soviet Union prior to their breakups. Belarus and Transnistria also use currencies with...

 at a rate of four markka equal to one ruble. In 1865 the markka was separated from the Russian ruble and tied to the value of silver
Silver
Silver is a metallic chemical element with the chemical symbol Ag and atomic number 47. A soft, white, lustrous transition metal, it has the highest electrical conductivity of any element and the highest thermal conductivity of any metal...

. After Finland gained independence in 1917 the currency was backed by gold. The gold standard
Gold standard
The gold standard is a monetary system in which the standard economic unit of account is a fixed mass of gold. There are distinct kinds of gold standard...

 was abolished in 1940, and the markka suffered heavy inflation during the war years
Winter War
The Winter War was a military conflict between the Soviet Union and Finland. It began with a Soviet offensive on 30 November 1939 – three months after the start of World War II and the Soviet invasion of Poland – and ended on 13 March 1940 with the Moscow Peace Treaty...

. In 1963 the markka was replaced by the new markka, equivalent to 100 old units.


Finland joined the Bretton Woods Agreement in 1948. The value of markka was pegged to the dollar at 320 mk/$, which became 3.20 new mk/$ in 1963 and devalued to 4.20 mk/$ in 1967. After the breakdown of the Bretton Woods agreement in 1971, a basket of currencies became the new reference. Occasionally, devaluation
Devaluation
Devaluation is a reduction in the value of a currency with respect to those goods, services or other monetary units with which that currency can be exchanged....

 was used, 60% in total between 1975 and 1990, allowing the currency to more closely follow the depreciating US dollar than the rising German mark
German mark
The Deutsche Mark |mark]], abbreviated "DM") was the official currency of West Germany and Germany until the adoption of the euro in 2002. It is commonly called the "Deutschmark" in English but not in German. Germans often say "Mark" or "D-Mark"...

. The paper industry, which mainly traded in US dollars, was often blamed for demanding these devaluations to boost their exports. Various economic controls were removed and the market was gradually liberalized throughout the 1980s and the 1990s.

The monetary policy called "strong markka policy" (vahvan markan politiikka) was a characteristic feature of the 1980s and early 1990s. The main architect of this policy was President Mauno Koivisto
Mauno Koivisto
Mauno Henrik Koivisto is a Finnish politician who served as the ninth President of Finland from 1982 to 1994. He also served as Prime Minister 1968–1970 and 1979–1982...

, who opposed floating the currency and devaluations. As a result, the nominal value of markka was extremely high and in the year 1990, Finland was nominally the most expensive country in the world.

Koivisto's policy was maintained only briefly after Esko Aho
Esko Aho
Esko Tapani Aho is a statesman and former Prime Minister of Finland.-Early life and career:Aho was born in Veteli, Finland. Prior to attending university, he began a career in politics. From 1974 to 1979, he was Chairman of the Finnish Centre Youth, which had before him grown many of his...

 was elected Prime Minister. In 1991, markka was pegged to the currency basket ECU
European Currency Unit
The European Currency Unit was a basket of the currencies of the European Community member states, used as the unit of account of the European Community before being replaced by the euro on 1 January 1999, at parity. The ECU itself replaced the European Unit of Account, also at parity, on 13...

, but the peg had to be withdrawn after two months with a devaluation
Devaluation
Devaluation is a reduction in the value of a currency with respect to those goods, services or other monetary units with which that currency can be exchanged....

 of 12%. In 1992, Finland was hit by a severe recession
Recession
In economics, a recession is a business cycle contraction, a general slowdown in economic activity. During recessions, many macroeconomic indicators vary in a similar way...

. It was caused by several factors, the most severe being the incurring of debt, as the 1980s economic boom was based on debt. Also, Soviet Union had collapsed, which brought an end to the bilateral trade
Bilateral trade
Bilateral trade or clearing trade is trade exclusively between two states, particularly, barter trade based on bilateral deals between governments, and without using hard currency for payment...

, and existing trade connections were severed. The most important source of export revenue, Western markets, were also depressed during the same time. As a result, by some opinions years overdue, the artificial fixed exchange rate was abandoned and the markka was floated. Its value immediately decreased 13% and the inflated nominal prices converged towards German levels. Also, as a result, several entrepreneurs who had borrowed money denominated in foreign currency suddenly faced insurmountable debt.

The Finnish markka was added into the ERM
European Exchange Rate Mechanism
The European Exchange Rate Mechanism, ERM, was a system introduced by the European Community in March 1979, as part of the European Monetary System , to reduce exchange rate variability and achieve monetary stability in Europe, in preparation for Economic and Monetary Union and the introduction of...

 system in 1996 and then became a fraction of the euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...

 in 1999, physical euro money arriving later in 2002. It has been speculated that if Finland had not joined the euro, market fluctuations such as the tech bubble would have reflected as wild fluctuations in the price of markka. (Nokia
Nokia
Nokia Corporation is a Finnish multinational communications corporation that is headquartered in Keilaniemi, Espoo, a city neighbouring Finland's capital Helsinki...

, formerly traded in markka, was in 2000 the European company with the highest market capitalization
Market capitalization
Market capitalization is a measurement of the value of the ownership interest that shareholders hold in a business enterprise. It is equal to the share price times the number of shares outstanding of a publicly traded company...

.)

Names


The name "markka" was based on a medieval unit of weight. Both "markka" and "penni" are similar to words used in Germany for that country's former currency, based on the same roots as the German Mark and pfennig
Pfennig
The Pfennig , plural Pfennige, is an old German coin or note, which existed from the 9th century until the introduction of the euro in 2002....

.

Although the word "markka" predates the currency by several centuries, the currency was established before being named "markka". A competition was held for its name, and some of the other entries included "sataikko" (meaning "having a hundred parts"), "omena" (apple) and "suomo" (from "Suomi", the Finnish name for Finland).

With numbers, Finnish does not use plurals but partitive
Partitive case
The partitive case is a grammatical case which denotes "partialness", "without result", or "without specific identity". It is also used in contexts where a subgroup is selected from a larger group, or with numbers....

 singular forms: "10 markkaa" and "10 penniä" (the nominative is penni). In Swedish, the singular and plural forms of mark and penni are the same.

When the euro replaced markka, mummonmarkka "grandma's markka" (sometimes shortened to just mummo) became a new slang term for the old currency. The sometimes used "old markka" can be misleading, since it can also be used to refer to the pre-1963 markka.

In Helsinki slang
Helsinki slang
Helsinki slang or stadin slangi is a local dialect and a sociolect of the Finnish language mainly used in the capital Helsinki...

, the post-1963 new markka was known as huge [hu.ge] (from Swedish hundra "hundred").

Coins


When the markka was introduced, coins were minted in copper (1, 5 and 10 penniä), silver (25 and 50 penniä, 1 and 2 markkaa) and gold (10 and 20 markkaa). After the First World War, silver and gold issues were ceased and cupro-nickel 25 and 50 penniä and 1 markka coins were introduced in 1921, followed by aluminium-bronze 5, 10 and 20 markkaa between 1928 and 1931. During the Second World War, copper replaced cupro-nickel in the 25 and 50 penniä and 1 markka, followed by an issue of iron 10, 25 and 50 penniä and 1 markka. This period also saw the issue of holed 5 and 10 penniä coins.

All coins below 1 markka had ceased to be produced by 1948. In 1952, a new coinage was introduced, with smaller iron (later nickel plated) 1 and 5 markka coins alongside aluminium-bronze 10, 20 and 50 markka and (from 1956) silver 100 and 200 markka denominations. This coinage continued to be issued until the introduction of the new markka in 1963.

The new markka coinage consisted initially of six denominations: 1 (aluminium), 5 (copper, later aluminium), 10 (aluminium-bronze, later aluminium), 20 and 50 penniä (aluminium-bronze) and 1 markka (silver, later cupro-nickel). From 1972, aluminium-bronze 5 markka were also issued.

The last series of Finnish markka coins included five coins (listed with final Euro
Euro
The euro is the official currency of the eurozone: 17 of the 27 member states of the European Union. It is also the currency used by the Institutions of the European Union. The eurozone consists of Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Luxembourg,...

 values, rounded to the nearest cent):
  • 10 penniä (silver-coloured) - a honeycomb on the reverse and a lily of the valley
    Lily of the Valley
    Convallaria majalis , commonly known as the lily-of-the-valley, is a poisonous woodland flowering plant native throughout the cool temperate Northern Hemisphere in Asia and Europe....

     flower on the obverse (0.02)
  • 50 penniä (silver-coloured) - haircap moss on the reverse and a bear
    Bear
    Bears are mammals of the family Ursidae. Bears are classified as caniforms, or doglike carnivorans, with the pinnipeds being their closest living relatives. Although there are only eight living species of bear, they are widespread, appearing in a wide variety of habitats throughout the Northern...

     on the obverse (0.08)
  • 1 markka (copper-coloured) - the Finnish coat of arms on the obverse (0.17)
  • 5 markkaa (copper-coloured) - a lily pad
    Nymphaeaceae
    Nymphaeaceae is a family of flowering plants. Members of this family are commonly called water lilies and live in freshwater areas in temperate and tropical climates around the world. The family contains eight genera. There are about 70 species of water lilies around the world. The genus...

     leaf and a dragonfly
    Dragonfly
    A dragonfly is a winged insect belonging to the order Odonata, the suborder Epiprocta or, in the strict sense, the infraorder Anisoptera . It is characterized by large multifaceted eyes, two pairs of strong transparent wings, and an elongated body...

     on the reverse and a Saimaa seal
    Saimaa Ringed Seal
    The Saimaa ringed seal The Saimaa ringed seal The Saimaa ringed seal (Pusa hispida saimensis, is a subspecies of ringed seal (Pusa hispida). They are among the most endangered seals in the world, having a total population of only about 260 individuals. The only existing population of these seals is...

     on the obverse (0.84)
  • 10 markkaa (two-metal coin, copper-coloured centre and silver-coloured edge) - rowan tree
    Rowan
    The rowans or mountain-ashes are shrubs or small trees in genus Sorbus of family Rosaceae. They are native throughout the cool temperate regions of the Northern Hemisphere, with the highest species diversity in the mountains of western China and the Himalaya, where numerous apomictic microspecies...

     branches and berries on the reverse and a wood grouse
    Capercaillie
    The Western Capercaillie , also known as the Wood Grouse, Heather Cock or Capercaillie , is the largest member of the grouse family, reaching over 100 cm in length and 6.7 kg in weight. The largest one ever recorded in captivity had a weight of 7.2 kg....

     on the obverse (1.68)



Banknotes


This section covers the last design series of the Finnish markka, designed in the 1980s by Finnish designer Erik Bruun
Erik Bruun
Erik Bruun is a Finnish graphic designer.Bruun spent his childhood in village of Säiniö on the Carelian isthmus. In the war years his family was forced to move to Helsinki, where he later enrolled in the Central School of Industrial Design...

 and issued in 1986.
Denomination Main colour Reverse Obverse Remark
10 markkaa Blue Paavo Nurmi
Paavo Nurmi
Paavo Johannes Nurmi was a Finnish runner. Born in Turku, he was known as one of the "Flying Finns," a term given to him, Hannes Kolehmainen, Ville Ritola, and others for their distinction in running...

 (1897 – 1973), athlete and Olympic winner
Helsinki Olympic Stadium
Helsinki Olympic Stadium
The Helsinki Olympic Stadium , located in the Töölö district about from the center of the Finnish capital Helsinki, is the largest stadium in the country, nowadays mainly used for hosting sports events and big concerts. The stadium is best known for being the center of activities in the 1952...

Discontinued upon introduction of the 20 markkaa note
20 markkaa Blue/green Väinö Linna
Väinö Linna
Väinö Linna was one of the most influential Finnish authors of the 20th century. He shot to immediate literary fame with his third novel, Tuntematon sotilas , and consolidated his position with the trilogy Täällä Pohjantähden alla Väinö Linna (20 December 1920 – 21 April 1992) was one of the...

 (1920 – 1992), author and novelist
Tammerkoski bridge Introduced in 1993
50 markkaa Brown Alvar Aalto
Alvar Aalto
Hugo Alvar Henrik Aalto was a Finnish architect and designer. His work includes architecture, furniture, textiles and glassware...

 (1898 – 1976), architect
Finlandia Hall
Finlandia Hall
Finlandia Hall is a concert hall with a congress wing in Helsinki, Finland, by Töölönlahti bay. The building was designed by Alvar Aalto. The work began in 1967 and was completed in 1971.-Design and building:...

100 markkaa Green Jean Sibelius
Jean Sibelius
Jean Sibelius was a Finnish composer of the later Romantic period whose music played an important role in the formation of the Finnish national identity. His mastery of the orchestra has been described as "prodigious."...

 (1865–1957), composer
Swans
500 markkaa Red Elias Lönnrot
Elias Lönnrot
Elias Lönnrot was a Finnish philologist and collector of traditional Finnish oral poetry. He is best known for compiling the Kalevala, the Finnish national epic compiled from national folklore.-Education and early life:...

 (1802–1884), compiler of Kalevala
Kalevala
The Kalevala is a 19th century work of epic poetry compiled by Elias Lönnrot from Finnish and Karelian oral folklore and mythology.It is regarded as the national epic of Finland and is one of the most significant works of Finnish literature...

Forest hiking trail
1000 markkaa Blue/purple Anders Chydenius
Anders Chydenius
Anders Chydenius was the leading classical liberal of Nordic history. Born in Sotkamo, Ostrobothnia, Sweden and having studied under Pehr Kalm at the Royal Academy of Åbo, Chydenius became a priest, Enlightenment philosopher and member of the Swedish Riksdag of the Estates.The world's first...

 (1729–1803), priest and statesman
Kuninkaanportti
Kuninkaanportti
Kuninkaanportti or Kungsporten is the principal entrance to the fortress Suomenlinna outside Helsinki...

 gate in Suomenlinna
Suomenlinna
Suomenlinna, until 1918 Viapori , or Sveaborg , is an inhabited sea fortress built on six islands , and which now forms part of the city of Helsinki, the capital of Finland.Suomenlinna is a UNESCO World Heritage site and popular with both tourists and locals, who...

5000 markkaa Red/purple Mikael Agricola
Mikael Agricola
Mikael Agricola was a clergyman who became the de facto founder of written Finnish and a prominent proponent of the Protestant Reformation in Sweden . He is often called the "father of the Finnish written language". Agricola was consecrated as the bishop of Turku in 1554, without papal approval...

 (1510–1557), priest and linguist
Turku Cathedral The note was never introduced. It was only a backup plan for inflation.

On this final banknote series, Bank of Finland used a photograph of Väinö Linna on the 20 markkaa note without permission from copyright holders. This was only revealed after several million notes were in use. The Bank paid 100,000 mk (€17,000) compensation to rights holders.

The second-to-last banknote design series, designed by Tapio Wirkkala
Tapio Wirkkala
File:Wirkkala.jpgTapio Wirkkala was a Finnish designer and sculptor, a major figure of post-war design. His work ranges from plastic ketchup bottles and metalware to glass, ceramics and plywood in a range of styles. He designed the Finnish markka banknotes introduced in 1955...

, was introduced in 1955 and revised in the reform of 1963. It was the first series to depict actual specific persons. These included Juho Kusti Paasikivi
Juho Kusti Paasikivi
Juho Kusti Paasikivi was the seventh President of Finland . Representing the Finnish Party and the National Coalition Party, he also served as Prime Minister of Finland , and was generally an influential figure in Finnish economics and politics for over fifty years...

 on the 10 markkaa note, K. J. Ståhlberg
Kaarlo Juho Ståhlberg
Kaarlo Juho Ståhlberg was a Finnish jurist and academic, who played a central role in the drafting of the Constitution of Finland in 1919. He was the first President of Finland and a nationalist liberal.-Early life:...

 on the 50 markkaa, J. V. Snellman
Johan Vilhelm Snellman
Johan Vilhelm Snellman was an influential Fennoman philosopher and Finnish statesman, ennobled in 1866.Snellman was born in Stockholm, Sweden, as son of Kristian Henrik Snellman, a ship's captain...

 on the 100 markkaa and Urho Kekkonen
Urho Kekkonen
Urho Kaleva Kekkonen , was a Finnish politician who served as Prime Minister of Finland and later as the eighth President of Finland . Kekkonen continued the “active neutrality” policy of his predecessor President Juho Kusti Paasikivi, a doctrine which came to be known as the “Paasikivi–Kekkonen...

 on the 500 markkaa note (introduced later).

Unlike Erik Bruun's series, this series did not depict any other real-life subjects, but only abstract ornaments in addition to the person depictions. A popular joke at the time was to cover Paasikivi's face except for his ear and back of the head on the 10 markkaa note, ending up with something resembling a mouse, said to be the only animal illustration in the entire series.

The still-older notes, designed by Eliel Saarinen
Eliel Saarinen
Gottlieb Eliel Saarinen was a Finnish architect who became famous for his art nouveau buildings in the early years of the 20th century....

, were introduced in 1922. They also depicted people, but these were generic men and women, and did not represent any specific individuals. The fact that these men and women were depicted nude caused a minor controversy at the time.

Coins & banknotes that were legal tender at the time of the markka's retirement can be exchanged for euros until February 28, 2012.

See also

  • Bank of Finland
    Bank of Finland
    The Bank of Finland is the central bank of Finland. It is the fourth oldest central bank in the world.-History:The Bank of Finland was established on 1 March in 1812 in the city of Turku by Alexander I of Russia. In 1819 it was relocated to Helsinki...

  • Scandinavian Monetary Union
    Scandinavian Monetary Union
    The Scandinavian Monetary Union was a monetary union formed by Sweden and Denmark on May 5, 1873, by fixing their currencies against gold at par to each other...

  • Finnish euro coins
    Finnish euro coins
    Finnish euro coins feature three separate designs. Heikki Häiväoja provided the design for the 1 cent – 50 cent coins, Pertti Mäkinen provided the design for the 1 euro coin, and Raimo Heino provided the design for the 2 euro coin, which shows cloudberry, the golden berry of northern Finland...

  • Economy of Finland
    Economy of Finland
    Finland has a highly industrialised, mixed economy with a per capita output equal to that of other western economies such as France, Germany, Sweden or the United Kingdom. The largest sector of the economy is services at 65.7 percent, followed by manufacturing and refining at 31.4 percent. Primary...


External links