Paper Money

‘Watermelon Note’ ripe for picking at May Heritage sale

One of the 27 publicly available examples of the 35 known legendary Series 1890 $100 Treasury notes, famously called the “Watermelon Note,” will be the centerpiece of Heritage Auctions’ May 3 to 5 Central States Numismatic Society Currency Signature Auction in Dallas.

The moniker reflects the unusual back, on which the round, plump zeroes are evocative of the fruit.

The note being sold is graded About Uncirculated 50 “Details” by Paper Money Guaranty. The “Details” comment refers to some closed pinholes in the center. The last two times this note sold it was graded as Extremely Fine 45 by PCGS Currency, realizing $253,000 in 2007 and $201,250 in 2011. The Heritage estimate is $200,000 and up.

It has an illustrious pedigree first tracing back to two Texans, William A. Philpott (“Mr. Phil,”), secretary of the Texas Banker’s Association from 1915 to 1964 and then San Antonio dealer Bob Medlar. Medlar sold it to Frank Levitan who sold it at auction for $99,000 in 1998.

This note is one of the three finest known. There is also an AU-53 example and a Choice Uncirculated 63 issue, the latter of which brought a record high $372,000 in 2020.

Rarer than a “Watermelon Note,” with just 25 known, but nowhere near as popular, since it is a large-size Federal Reserve note, is a cut sheet of four Boston Series 1914 $100 red seal notes (Friedberg 1072a), each graded Choice Uncirculated 64 by PMG. The set is expected to sell for at least $90,000.

National bank notes are a key component of the sale, led by two rare Territory of Hawaii issues. The first is one of four known F-477 $5 Series 1882 Brown Back notes from First National Bank of Wailuku, a note making its first appearance at an auction. It is graded Fine 15 and estimated at $60,000. The only other one of the four to ever be offered was in a 1997 sale, when it was purchased for $27,500.

The other Territory of Hawaii issue is an F-574 Series 1882 $5 Value Back note, issued by Honolulu’s First National Bank of Hawaii. At PMG Choice Uncirculated 63, it is the only Series 1882 Hawaii national bank note with such a high grade, and according to Heritage it’s one of fewer than 12 Uncirculated Series 1882 territorial National Bank Notes known, across all territorial issuers.

National Bank Notes are also the subject of the 110 lots in the enigmatic “Baton Rouge Bassett Collection,” which had been rumored, with whereabouts unknown, for nearly half a century. It has some of the rarest Louisiana and Mississippi national bank notes in existence, including unique, never before seen ones from Jennings, Opelousas, Starkville, and Welsh.

A leading lot from Mississippi is a serial number 1 Starkville $5 Series 1882 Brown Back note from the First National Bank (F-469) in PMG Very Fine 30, which is crossing the auction block for the first time. It is described as having all the major superlatives: It represents a rare type for Mississippi. It is the only serial number 1 Brown Back note known for the entire state. It was the only bank in this central Mississippi community, and one that issued only $5 Brown Back notes during its short existence from 1887 until its failure in 1893, with only $290 in face value outstanding in 1916. The only other note reported from this charter (3688) has not been seen since a 1991 auction. The estimate is $35,000 plus.

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