The Finnish markka’s nominal value is heading for the basement, but the collector price is going up

A pristine "Kekkonen" 500-markka banknote from 1975 is already worth hundreds of euros

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By Jukka Harju and Päivi Repo
     
      Eero Varkki pulls out banknotes and spreads them into neat little stacks on the counter at the Käpylän Merkki collectors’ store in Helsinki.
      One cannot help but to feel nostalgic: yellowish brown one-markka bills, pale blue five-markka bills, and ten-markka bills of two different shades of green.
      As kids we used to fold the tenner banknote to turn President Paasikivi’s right ear into the likeness of a rat.
      “I have more of this stuff at home”, Varkki says.
      He is a collector of banknotes from the time of Finland’s independence, and he can now afford to part with a few duplicates.
      In their place he hopes to receive something that he does not have yet - such as 50-markka banknotes printed in 1963.
     
The old markka banknotes will lose their nominal value in just over a year’s time, but their collector values have already climbed to completely different spheres.
      The good old markka coins and banknotes have become items of interest to thousands of collectors, even though they were taken out of circulation only nine years ago on the arrival of the upstart euro.
     
In collector circles, the value of a markka banknote that is in good condition may have grown many times over from its nominal value.
      It does not pay any longer to take the notes to the Bank of Finland for redemption.
      There the owner will only be paid the face value of the old bill, which, in turn, will end up in an incinerator.
      “I have instructed anyone who'll listen that if you take notes to the experts in the field you can easily get what the Bank of Finland is prepared to pay, plus in most cases a little bit of extra on top of that”, explains Timo Mäkinen, who runs the finntimo.com online collectors’ shop.
      Mäkinen’s advice does not apply to banknotes that are of not of good quality, however.
      “For them the correct address is still the Bank of Finland. Despite their condition, it still pays to have an expert evaluate one’s paper currency. Even among the very latest markka banknotes there are some rarities. Factors that may increase a note’s value can be for example the position of the watermark and other abnormalities”, he says.
     
Folding a banknote in half can leave a mark and reduce its collectables value by 50 per cent or much more.
      Käpylän Merkki shopkeeper Jyrki Ervasti demonstrates: a pristine unfolded hundred-markka banknote from 1957 costs EUR 20.
      A folded one is worth only two euros.
      Ervasti points out that there are different ways to collect banknotes. If the smooth ones seem too expensive, one can opt for the wrinkled ones.
     
But what will happen to the banknotes’ collection value, once the Bank of Finland ceases to redeem them?
      “One does not have to fear that their collection value would come down. However, large bills that are in poor condition will not be able to hold onto their value”, Mäkinen says.
      Jani Nuorala from the jncoins.com online store believes that the collection value will go up because the number of collectors is growing and the prices of the banknotes have already risen anyway.
      New collectors, under the age of 30, are also emerging on the scene.
      “Already we are struggling to have enough good quality banknotes to satisfy the demand”, Nuorala says.
      One of the most sought-after items is the 500-markka bill dedicated to President Urho Kekkonen from 1975, when Kekkonen turned 75..
      This banknote’s nominal value is EUR 84, but a more correct estimate is in the hundreds of euros, depending on its condition.
      There are still around 81,000 of them "out there" in circulation, although some of these may have disappeared for good and some have been destroyed.
     
Collecting paper currency is a big hobby.
      There are a few thousand people in Finland seriously involved in it.
      On top of this come the less active collectors, who do it for “nostalgic reasons”, and those who simply have some old banknotes lying at the bottom of a drawer.
      The reasons are many: someone wants to retain a piece of currency history, someone may consider his collection an investment, and someone simply wants to pass on a memento from the times when Finland had its own currency to the future generations.
      According to the Bank of Finland, there are still just under 40 million individual markka banknotes in circulation.
      They are worth an estimated EUR 127 million.
      The 1.6 million 100-markka notes from 1986, featuring Jean Sibelius on the front, are worth approximately EUR 28.5 million to their owners if they go to the Bank of Finland with them, but quite possibly a lot more if they are in "collectable" condition.
      Prices for these particular notes range from EUR 18-70.  
     
After the initial flurry when the markka ceased to be legal tender in March 2002, the return of the banknotes to the Bank of Finland has been slow.
      In the last couple of years the rate has been in the region of no more than ten million FIM worth per year.
      The speed of redeeming the markka notes is expected to pick up moderately towards the end of this year.
      "At the beginning of 2012 a peak is expected in the trading in of the old currency because of the approaching 'final countdown' deadline”, says Mika Pösö, Head of Communications for the Bank of Finland.
     
The redemption period will expire once and for all on 29th February, 2012, after which time the notes will only have value for collectors.
      When the window finally closes, it will affect numerous different series of banknotes dating back to as early as 1945, with the newest ones being those shown in the accompanying table, from 1986 and - in the case of the 20-markka note - from 1993.
      As suggested above, crisp unfolded notes in mint condition can bring in more from a collector than from the Bank of Finland or one of the commercial banks, who are also obliged to redeem the notes.
      Prices paid can also be affected by details like the serial number, the letter in front of it, the chief cashier's signature, or in the case of older notes, an asterisk after the serial number.
     
Markka coins from the final series minted before the introduction of the euro will also be redeemed only until February 29th.
      In the case of coins, the only address these days (apart from collectors' shops, of course) is the Bank of Finland.
      Details are given on the Bank of Finland website, linked below.
     
     
Helsingin Sanomat / First published in print 31.1.2011


Previously in HS International Edition:
  Bank of Finland still struggles to deal with returned old currency (6.3.2008)

Links:
  Käpylän Merkki
  Finntimo.com
  Bank of Finland: Redemption of markka notes, annulled on 1.3.2002
  Finnish markka (Wikipedia)
  Bank of Finland: Annulled notes and coins

PÄIVI REPO AND JUKKA HARJU / Helsingin Sanomat
paivi.repo@hs.fi, jukka.harju@hs.fi