Collectors see a bonus in new notes: Fresh colours will reduce confusion and excite traders, says Vincent Duggleby

THE BRITISH are very sensitive about new banknotes but the Bank of England's decision to change the colour of the denomination symbols, starting with the 'Stephenson' pounds 5, to make them clearer, will be welcomed by collectors for different reasons.

Unlike postage stamp issues, new varieties of banknote are infrequent. During the 20 years that the previous series D 'Wellington' pounds 5 note was in circulation there were only two minor changes: a switch to litho printing in 1973 and the incorporation of a wider security thread in 1987. The same happened to the 'Nightingale' pounds 10 note while the 'Shakespeare' pounds 20 underwent a colour change in 1984 to combat forgery.

The washed-out colours of the current series E notes makes them more difficult to copy, but it also tends to confuse people, the elderly in particular, and the bank has responded to this concern. Among collectors, however, a new series means hunting for the first prefixes, as well as the last ones of the old notes.

Tomorrow a limited issue goes on sale of 2,000 presentation packs, with matched serial numbers, bearing the first ciphers of four notes with the signature of the new Chief Cashier, Graham Kentfield, who was appointed last November.

The four notes: pounds 5 RO1; pounds 10 KEO1; pounds 20 EO1; and pounds 50 also EO1, have a face value of pounds 85 and are priced at pounds 205 (including VAT). There has been some confusion about the pounds 20, since Kentfield notes with an 'A' prefix have turned up. The Bank says these were used to replace faulty notes in a bundle and that 'E' really was the first letter.

Some collectors are cynical about this explanation, pointing to the number of errors which have occurred over numbering and misprinting. A woman in Sheffield recently found a pounds 20 note with the watermark upside down and back to front and was nearly arrested when the supermarket mistakenly thought it was a forgery. Not that anyone is grumbling: error notes can fetch between pounds 75 and pounds 200.

The Bank says there are no plans to set aside any of the new notes for future presentation packs. No one knows when or where the first new pounds 5 prefix (AA01) will turn up, although it might be worth trying the cashiers at Threadneedle Street. The same applies to the revised pounds 10 and pounds 20 notes which will appear 'during the course of 1993', although their prefixes have not yet been decided.

It may well depend on the luck of the draw at the local cash dispenser, when the notes start going into circulation from 1 March, and dealers are sure to offer finders an instant, if modest, profit.

AN EXAMPLE of the rare unissued Bank of England pounds 1 note prepared in 1914 at the outset of the First World War comes up for auction in Manchester on Wednesday. The note, of which fewer than a dozen have survived, has the printed 'promise to pay the bearer on demand One Pound in standard gold coin of the United Kingdom'. The auctioneers, Banking Memorabilia of Carlisle, estimate it could fetch up to pounds 3,500.