Reichsbank Head Office in Vienna, 1943
Reichsbank Head Office in Vienna, close-up of the main entrance
After the end of World War I, it was not possible for the Austrian society to return to a coherent social order. Camps were formed in all areas, and these imposed their interests with fraud, force and arms, if necessary. The corporative state, which was isolated in domestic and foreign affairs because it was ruled by an authoritarian government and because of the immobilization of the Social Democrat Party, could not muster the powers necessary to repudiate the efforts of the National Socialist Third Reich to annex Austria.
The seizure of power by the National Socialists in March 1938 was accompanied by arrests, abductions and suicides of Austrian politicians, artists and intellectuals, above all, people of Jewish origin. Sigmund Freud, for example, emigrated under threatening circumstances.
The "Anschluss" of Austria to the German Reich also affected the central bank. Just a few days after the invasion of German troops in Vienna, a German law ordered the liquidation of the Oesterreichische Nationalbank; it became property of the German Reichsbank. Also, all gold and foreign currency were transferred to Berlin. Officials of the German Reichsbank took over power in the entire area of the present headquarters of the Reichsbank in Vienna as well as in all the subsidiaries of the bank on Austrian territory. All the officials, employees and workers of the institute who seemed suspect to the new powers were dismissed, sent into retirement or removed by arrest within a very short time.
Directly after the occupation, the monetary Anschluss took place. With the ordinance of March 17, 1938, the Reichsmark currency was introduced in Austria; the exchange rate for one Reichsmark amounted to 1.5 schillings.
Allied Military Authority: 5 Schillings – 1944
Former Bregenz branch office of the German Reichsbank
The war that was initiated by the German attack on Poland in 1939 and that expanded into World War II quickly put a huge strain on all of society.
Numerous employees of the central bank were drafted into the Wehrmacht. Bank employees who returned to their place of work in 1945 were confronted with terrible conditions. Hundreds of thousands of people had been killed in the War; production plants and residential areas were severely damaged; the power of the Austrian economy was noticeably weakened. After the war the Austrian productive capacity had fallen to 40% of the 1937 level.
The National Socialists had enormously increased the circulation of money in order to finance the War. According to today`s estimates, the circulation of notes and coins which would have been able to stabilize prices by the end of 1946 would not have been allowed to exceed half a billion Reichsmark. In fact, the circulation of money already reached an (estimated) extent of about 11 billion Reichsmark at the end of the War. In addition, the Allies had issued paper money; all in all, around 10 billion Allied military schillings had been printed.
