Stockholms Banco

It was founded in 1657 by Johan Palmstruch in Stockholm, began printing banknotes in 1661, but ran into financial difficulties and was liquidated in 1667.

The first of these (which opened in July 1657) took deposits for a fee (and accruing no interest) with the account owner later able to withdraw the money as cash or to write cheques.

Palmstruch's second major innovation was the introduction of paper banknotes as a solution to the bank's problems balancing deposits and loans.

To cover the amounts requested by the account holders, in 1661 he began to make out credit notes (Kreditivsedlar) in round denominations which were freely transferable and backed by the promise of future payment in metal.

By autumn of that year loans and note issues had reached such levels that the value of the banknotes began to fall.

The government and Riksdag (Swedish Parliament) were forced to take over, reducing the outstanding loans and exchanging the notes for coins.