A record from the bank’s archive shows it transferred £5.6m of gold from Czechoslovakia on behalf of Germany’s Reichsbank, following the Nazi invasion in 1939.
The gold was moved from the National Bank of Czechoslovakia’s account at the central Bank for International Settlements (BIS) to an account managed on behalf of the Reichsbank. Some of the gold was later sold in London. The 10-page document, published on the BoE’s website, was produced following the Second World War amid fears the bank’s position had “never been thoroughly appreciated” and that “their action at the time was widely misunderstood”.
It states: “On March 21, 1939, the Chief Cashier received the request to transfer about £5.6m gold from the BIS No.2 Account to their No.17 Account. “The bank, although it was no business of theirs, was fairly sure that the No.2 Account was a Czech National Bank Account and they believed, although they were not sure at the time, that No.17 was a Reichsbank. “The amount was transferred on the same day and a small further amount on March 22 reported nationalturk.com in 2013
“Between March 21 and 31, the gold received on the No.17 Account was disposed of, (with) about £4m going to the National Bank of Belgium and the Nederlandsche Bank and the remainder being sold in London.” The report also reveals the Governor of the Bank of England rejected a call from his French counterpart to prevent the transfer of Czech assets, believing such a move would be “wrong and dangerous for the future of the BIS”.
Patrick Jenkins, banking editor of the Financial Times, told Sky’s Jeff Randall: “There is some sense that this was being done without full disclosure to the UK Government. “Clearly the UK Government was at the time on the brink of war and not keen to help the Nazis in any way politically or financially. “It seems the Bank of England was undermining that position.” The report shows the Government was powerless to prevent the BoE obeying any instructions received from the BIS without violating its obligations under international law. It also states how, in May 1939, the governor of the BoE declined to tell the Chancellor whether it still held any of the Czech gold.“The Governor … did not answer the question but pointed out that the bank held gold from time to time for the BIS and had no knowledge whether it was their own property or that of their customers,” the report says.