The Geneva Protocol was signed, whereby the Bank of Greece was established and assigned the note-issue privilege. The drachma was pegged to the pound sterling at a parity of 375 drachmas/pound.
The Bank of Greece started operations on 14 May 1928. In order to deal with the technical problems associated with the replacement of the National Bank of Greece banknotes already in circulation and given that there was a large stock of uncirculated NBG banknotes issued in 1923-1927, it was decided to launch them overstamped with the words "Bank of Greece" in red ink. Five years later, on 3 May 1933, the first 500- and 5,000-drachma banknotes, printed on behalf of the Bank of Greece by the American Bank Note Company in the USA, were put into circulation.
In 1935, 1,000-, 50- and 100-drachma banknotes were printed in France, of quite different aesthetics, rich in colour and without heavy outlines and decorations. They depicted: a girl of Spetses in local costume, resting her hand on a jar (1,000 drachmas), a female harvester holding a sheaf of wheat (50 drachmas) and the god Hermes (100 drachma). When these banknotes were put into circulation, the overstamped series of the NBG banknotes were withdrawn from circulation.
By decision of the General Council of 7 June 1938, the “Printing Works of the Bank of Greece” (IETA) was established and entrusted with the task of designing and printing banknotes. The construction work for IETA’s facilities at Holargos, Athens, began immediately, and the first printing presses were ordered. However, because of the war, IETA only started operations after Greece's liberation.
Banknotes were issued in denominations of 50, 100, 500 and 1,000drachmas, printed in England and France, were issued (2nd series). The pre-1935 aesthetics returned, with themes from antiquity and heavy decorative borders. In order to meet urgent needs, the 100-drachma banknotes were overstamped and redenominated as 1,000 drachmas, without however this counting as a new series. The 50-drachma banknote, the last to be issued before World War II, was printed in 1941 and circulated in the Middle East.
During the Axis occupation, banknotes were issued both in occupied Greece and abroad. Banknotes issued abroad do not bear an issue date, but only the series. 100-drachma (3rd series), 500-drachma (3rd series), 100-drachma (3rd series), 5,000-drachma (2nd series), 20,000-drachma (1st series) and 50,000-drachma (1st series) banknotes were issued.
The 5,000-, 10,000- and 20,000-drachma banknotes issued in the Middle East are interesting because there are different sizes and colours for the same denomination, without any change in the issue series.
Between 1941 and 1944, many banknotes of huge denominations were printed by various lithographers in Greece, due to galloping inflation; the last one, that of 100 billion drachmas, was printed on 5 November 1944.
Law 18/10 November 1944 introduced the first monetary reform, stipulating that one post-war drachma would equal 50 billion occupation drachmas.
The first post-war banknotes put into circulation on 11 November 1944 were 50- and 100-drachma banknotes, depicting the Nike of Samothrace and the portrait of fire-ship captain Konstantinos Kanaris.
In 1947, the Bank of Greece Printing Works (IETA), which, in the meantime, had been equipped with modern machinery and staffed with excellent artists, painters, engravers and specialised personnel, printed the 1,000-drachma (depicting Theodoros Kolokotronis), 5,000-drachma (maternity and Thetis bringing Achilles' armour), 10,000-drachma (Aristotle and the Charioteer of Delphi) and 20,000-drachma (heads of Athena and Medusa) banknotes.
In 1950, the first banknote designed, prepared and printed entirely by IETA was that of 5,000 drachmas (4th series), featuring the Greek poet Dionysios Solomos. A 5,000-drachma banknotes (1st series) depicting a head of a girl of Thrace and the temple of Poseidon at Sounion were also issued. Copperplate engraving was used for the first time in banknote printing.
Law 2824/20 June 1954 (Government Gazette 79 A) provided that the new drachma would equal 1,000 old drachmas and three zeros were struck from the denomination of banknotes. Thus, in 1954 the 10,000-, 20,000- and 50,000-drachma banknotes were put into circulation as 10, 20 and 50 drachmas. In 1955, the following banknotes were put into circulation: 10-drachma (head of King George I and the Church of the Holy Apostles at Thessaloniki), 20-drachma (head of Demokritos and Plato's Symposium), 50-drachma (head of Pericles and Pericles orating on the Pnyx) and 500-drachma (head of Socrates and St. Paul at the Areopagus).
In 1956, a 1,000-drachma banknote was printed. featuring Alexander the Great wearing a lion scalp on the obverse and Alexander the Great at the battle of Issos on the reverse. From the launch of IETA operations until 1956, banknotes were designed by A. Matsoukis, G. Velissaridis, S. Yiannaris, A. Koroyiannakis and F. Mastichiadis.
IETA launched a new practice for its banknote issues, sorting them by denomination and defining a specific theme and colour for each denomination. The following themes were chosen: "Shipping" (50-drachma banknote, the smallest in size, blue); "Education" (100-drachma, red); "Enlightenment" (200-drachma, orange); "Agriculture" (500-drachma, green); "Tourism" (1,000-drachma, brown); “Greek War of Independence" (5,000-drachma, blue); and "Science-Health" (10,000-drachma, violet).
A 50-drachma banknote was printed in 1964, depicting the head of Arethusa and a composition of an old and a modern shipyard, a 100-drachma banknote in 1966 (Demokritos and the Academy of Athens) and a 500-drachma banknote in 1968 (goddess Demeter, Triptolemos and Persephone). The banknotes were designed by G. Velissaridis and I. Stinis and engraved by L. Orphanos and G. Angelopoulos.
The 1,000-drachma banknote printed in 1970 depicted Zeus, a young woman of Hydra in local costume and a view of Hydra island.
A 50-drachma banknote was printed, depicting a head of Poseidon and the construction of the Argo on the obverse and Laskarina Bouboulina before the castle of Nafplion on the reverse. A 100-drachma banknote was printed in the same year, depicting the head of Athena of Piraeus and the building of the University of Athens on the obverse and Adamantios Korais and the Monastery of Arkadi on the reverse.
In 1983, a 500-drachma banknote was issued, depicting Ioannis Kapodistrias and the fortress of Corfu.
The first 5,000-drachma banknote since 1950 was issued in 1984, depicting Theodoros Kolokotronis and the Church of the Holy Apostles at Kalamata.
A 1,000-drachma banknote was put into circulation, depicting a head of Apollo and the Discus-thrower by Myron on the obverse and the temple of Hera at Olympia on the reverse.
The last banknote to be printed with the copperplate engraving technique, of 10,000 drachmas, was put into circulation. A portrait of George Papanicolaou adorns the obverse and the healer-god Asclepius the reverse.
The last drachma banknote was to be issued was that of 200 drachmas. This lithographed banknote depicted a portrait of Rigas Feraios on the obverse and N. Gysis's "Secret School" on the reverse.
1970 – 1996
All banknotes were designed by painters I. Stinis, V. Sabatakos, P. Sotiriou and N. Nikolaou and engraved by L. Orphanos, G. Angelopoulos, I. Pipinis and E. Perraki. Engraver P. Gravalos worked as an external collaborator.
The period during which the Bank of Greece exchanged drachma banknotes for euro ended on 1 March 2012.