The European Central Bank decided yesterday to scrap large numbers of €100 banknotes after a printing problem at a German plant raised fears that criminals could produce counterfeit versions of the money.

The banknotes were withdrawn less than 18 months before the euro is due to start circulating in the form of notes and coins on January 1st, 2002.

The problem occurred at Giesecke & Devrient, a private company based in Munich, and was discovered only after large numbers of the 325 million banknotes under order from the company had already been printed. The defect concerns a security feature designed to prevent the colour photocopying of bills.