The Bank of Isabella II (Spanish: Banco de Isabel II) was a financial institution in Spain, created by a Royal Decree of 25 January 1844[1] as a bank that, together with the Bank of San Fernando, began the process of establishing a Spanish banking apparatus adequate for industrialization and the transformation from feudalism to capitalism.[citation needed] Although not officially a bank of issue, it issued bonds that "were banknotes in all but name."[2] In theory it was an equal competitor to the Bank of San Fernando. In practice it focused in the private sector, as a bank for industry.[citation needed]
Among the main founders of the bank were José de Salamanca, Nazario Carriquiri, Alejandro Aguado, Gaspar Remisa, José Buschenthal, and Domingo de Norzagaray.[3] The bank had initial capital of 100 million reales in shares and credits.[4] It made generous loans to industrial and mining enterprises, but also to prominent members of the Spanish royal family such as the queen mother and former regent Maria Christina of the Two Sicilies and her husband, both of whom speculated heavily in railways. It favored the Moderate governments of General Ramón María Narváez. It bought shares of other French and British financial institutions, some of which were its own creditors.[citation needed] It made many loans to insolvent companies, many owned by its own managers.[2] Its risky approach to finance did not fare well.[2] To save it from failure, on 25 February 1847[1] the Minister of Finance merged it with the much healthier Bank of San Fernando, which focused its activity on the finances of the State. The resulting bank retained the name Bank of San Fernando until 1856, when it became the Bank of Spain.[5][6]
Notes
edit- ^ a b Teodora Gómez Herrero, Diccionario-guía legislativo español: comprende todas las disposiciones legales que se han publicado durante el presente siglo xix, presentadas dentro de un orden y clasificación por artículos, de tal forma enunciados..., Volume 1, Part 1, R. Fé, 1902. p. 172. Available online at Google Books.
- ^ a b c Gabriel Tortella, "Spanish Banking History, 1782 to the Present" 865:874 in Manfred Pohl, Sabine Freitag, European Association for Banking History, Handbook on the history of European banks, Elgar Original Reference Series, Edward Elgar Publishing, 1994, ISBN 1-85278-919-0. p. 866–867. Available on Google Books.
- ^ Oscar E. Vázquez, Inventing the art collection: patrons, markets, and the state in nineteenth-century Spain, Penn State Press, 2001, ISBN 0-271-02084-9, p. 157. Available on Google Books.
- ^ Guía oficial de España, Imprenta Nacional, 1876, p. 554. Available on Google Books.
- ^ History of a Central Bank Archived 2009-12-13 at the Wayback Machine, Banco de España, p. 6 (p. 8 of PDF). Retrieved 2010-03-03.
- ^ Brief History Archived 2009-12-13 at the Wayback Machine, Banco de España. Retrieved 2010-03-04.