The creation of the West African Currency Board was a delayed consequence of the increasingly widespread adoption of the
gold standard in the late 19th century and corresponding adjustments in the markets for precious metals, which triggered new concerns about monetary stability. The British authorities were concerned about the potential sudden repatriation of coinage from the West African colonies, which from 1901 to 1910 had absorbed nearly as many coins as had been circulated in Britain itself. The creation of a separate currency was preferred by the
British Treasury to the alternative of sharing the
seigniorage earned in the colonies, as was advocated by the colonial governors of Lagos and the Gold Coast. Established in London, the Currency Board started operations in 1913. It kept a reserve in British pound sterling for 100 percent of its issuance of coins and notes. It was the first such currency board serving British colonies and was used as a model for subsequent ones including the
East African Currency Board,
Southern Rhodesia Currency Board, and currency boards in post-WWII
Libya and
Somaliland. It distributed its profits to the governments of the four colonies: from 1912 to 1950 these amounted to 8.7 million pounds, of which Nigeria received 4.5 million (52 percent), the Gold Coast 3.3 million (38 percent), Sierra Leone 0.7 million (8 percent), and the Gambia 0.2 million (2 percent). ==Dissolution==