Global Banknote Market Report: 2012 Edition. October 2012

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1 Global Banknote Market Report: 2012 Edition October 2012

2 Executive Summary Moving from barter to currency, the introduction of banknotes was the landmark development which enabled the growth of trade and commerce transcending all geographic barriers. The responsibility for the issuance of new banknotes and the destruction of the ones unfit for circulation rests with the central banks of each country. The authorities entrusted with the note issuing privilege aim to meet high standards of quality and security, and most importantly seek to ensure public confidence in the currency. The global banknote issuance has been on a continuous rise over the past years and is expected to grow further in the times ahead. The US dollar and Euro have a great significance in the international market and will continue to gain more importance in the years to come. There has been a notable growth in the circulation of banknotes in the recent past in most of the economies across the world. This trend is anticipated to pressurize the entities involved in the manufacturing of banknotes to maximize the production of the same. Money supply is being governed by many factors which are both macro in nature like GDP, demography, and inflation and also micro in nature, such as user friendliness and safety, etc. However, the aforementioned factors may influence the money supply both positively or negatively. Further, the note issuing authorities as well as other entities involved in the process of production and supply of banknotes remain focused towards technological upgradations, which is decidedly a major favorable influence on the banknote industry. However, the industry continues to face serious challenges on account of constant growth in counterfeit currencies over the past years. Companies in the global banknote market operate in a highly competitive environment, with the ability to manufacture superior quality banknotes, ability to develop innovative security features, and circulation being the key factors responsible for competition in the market. De La Rue plc, Giesecke & Devrient (G&D) Group, Oberthur, Crane Currency, and Fortress Paper Ltd, among others are the key players in the global arena. The report provides an analysis of the global banknote industry. It discusses major market trends and potential markets for banknote industry. The report also presents the competitive structure of the industry and profiles major players with a discussion of their key business strategies. Koncept Analytics Copyright

3 2. Global Banknote Industry According to the latest Currency Composition of Official Foreign Exchange Reserves (COFER) database released by the IMF, the US dollar accounted for Figure 2.1: Currency Composition of Official Foreign Exchange Reserves Major Currencies, US Dollar Euro Pound Sterling Japanese Yen Figure 2.2: Currency Composition of Official Foreign Exchange Reserves, Q112 US Dollar Euro Pound Sterling Japanese Yen Swiss Franc Other currencies Koncept Analytics Copyright

4 Billion notes % Billion Figure 2.3: Global Banknote Issuance, F F 2015F Figure 2.4: Global Banknote Production by Segment, 2012E State Print Works (SPW) Commercial print market Overspill from SPW s Figure 3.1: Annual US Currency Notes Production, Annual Production Growth Rate Koncept Analytics Copyright

5 Table 3.1: Annual US Currency Notes Production - Denomination-Wise, US$1 US$2 US$5 US$10 US$20 US$50 US$100 FY 1980 Xx Xx Xx Xx Xx Xx Xx FY 1981 Xx Xx Xx Xx Xx Xx Xx FY 1982 Xx Xx Xx Xx Xx Xx Xx FY 1983 Xx Xx Xx Xx Xx Xx Xx FY 1984 Xx Xx Xx Xx Xx Xx Xx FY 1985 Xx Xx Xx Xx Xx Xx Xx FY 1986 Xx Xx Xx Xx Xx Xx Xx FY 1987 Xx Xx Xx Xx Xx Xx Xx FY 1988 Xx Xx Xx Xx Xx Xx Xx FY 1989 Xx Xx Xx Xx Xx Xx Xx FY 1990 Xx Xx Xx Xx Xx Xx Xx FY 1991 Xx Xx Xx Xx Xx Xx Xx FY 1992 Xx Xx Xx Xx Xx Xx Xx FY 1993 Xx Xx Xx Xx Xx Xx Xx FY 1994 Xx Xx Xx Xx Xx Xx Xx FY 1995 Xx Xx Xx Xx Xx Xx Xx FY 1996 Xx Xx Xx Xx Xx Xx Xx FY 1997 Xx Xx Xx Xx Xx Xx Xx FY 1998 Xx Xx Xx Xx Xx Xx Xx FY 1999 Xx Xx Xx Xx Xx Xx Xx FY 2000 Xx Xx Xx Xx Xx Xx Xx FY 2001 Xx Xx Xx Xx Xx Xx Xx FY 2002 Xx Xx Xx Xx Xx Xx Xx FY 2003 Xx Xx Xx Xx Xx Xx Xx FY 2004 Xx Xx Xx Xx Xx Xx Xx FY 2005 Xx Xx Xx Xx Xx Xx Xx FY 2006 Xx Xx Xx Xx Xx Xx Xx FY 2007 Xx Xx Xx Xx Xx Xx Xx FY 2008 Xx Xx Xx Xx Xx Xx Xx FY2009 Xx Xx Xx Xx Xx Xx Xx FY2010 Xx Xx Xx Xx Xx Xx Xx Koncept Analytics Copyright