Note 11 — Its Early History

About 14 Spanish firms of a certain importance were established in Manila, Yloilo, and Cebú, in addition to the Europeans trading here and there on the coasts of the Islands. In Manila there were (and are still) two foreign bank branches11 (one with a sub-branch in Yloilo), three bank agencies, and the Philippine private banking-house of J. M. Tuason & Co.; also the “Banco Español-Filipino,” which was instituted in 1852, with a capital of ₱400,000, in 2,000 shares of ₱200 each. The capital was subsequently increased to ₱600.000.12 Authorized by charter, it issued notes payable to bearer on demand from ₱10 upwards. The legal maximum limit of note issue was ₱1,200,000, whilst the actual circulation was about ₱100,000 short of that figure. This bank did a very limited amount of very secure business, and it has paid dividends of 12 to 15 per cent.; hence the shares were always at a premium. In 1888, when 12 per cent, dividend was paid, this stock was quoted at ₱420; in 1895 it rose to ₱435. The Obras Pias funds (vide p. 245) constituted the orginal capital of the bank. The new position of this institution, under the (American) Insular Government since 1905, is explained in Chapter xxxi.