ABSTRACT
Exchange banking A bank is an institution with three possible functions, which, in historical order, may be called conversion, deposit and giro. The origins of the first of these, conversion, are to be found in the profession of money-changer, which developed very soon after the separate Greek city states each began to issue their own silver coins (Bogaert, 1966, p. 136).1 Its basis in any city was the sale and purchase of foreign coin, with payment in the local currency, and a margin between the prices paid which gave the money-changer his profit. The table, or trapedza, at which the money-changer carried on his trade provided the word which is still that for ‘bank’ in modern Greek. When, at the dawn of the Renaissance, Italian moneychangers began to carry on their business in the same way, the Latin equivalent, bancum, was used and eventually became current usage for a ‘bank’ in almost every part of the world-except Greece (ibid., p. 144). As chapter 15 below will show, this form of foreign exchange was-except in the ancient world-of relatively minor importance: it did however provide the basis for depost banking, so its historical importance can hardly be underrated.
