Establishment of the State Bank of the Russian Empire

Background. The state-owned banking system, including the State Commercial Bank and the State Loan Bank, collapsed in a bank run in 1858–1859. The State Bank of the Russian Empire was founded in 1860 and became the dominant financial institution of the Empire until its end in 1917.

Establishment. The State Bank was established on 12 June [O.S. 31 May] 1860 by ukaz of Emperor Alexander II, at the behest of Minister of Finance Alexander Knyazhevich. A public bank headquartered in Saint Petersburg, it initially coexisted within the Empire with the Bank Polski and with the Bank of Finland, which soon defined a separate monetary zone for the Finnish markka. In Saint Petersburg, the State Bank took over the former building of the Russian Assignation Bank, commissioned by Catherine the Great in 1782 and completed in 1789 on a design by Giacomo Quarenghi.

Early Operations. In its first decades, the State Bank was not a genuine central bank because it could not make independent decisions on critical monetary matters such as issuing notes. Instead, it could only issue banknotes at the order of the finance ministry, which was effectively in charge of Russia's monetary policy until the reforms of the 1890s.