The Bank of Isabella II ( es, Banco de Isabel II) was a financial institution in

Spain , image_flag = Bandera de España.svg , image_coat = Escudo de España (mazonado).svg , national_motto = ''Plus ultra'' (Latin)(English: "Further Beyond") , national_anthem = (English: "Royal March") , i ...

, created by a Royal Decree of 25 January 1844Teodora 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
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at

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. as a bank that, together with the

Bank of San Fernando The Bank of San Fernando ( es, Banco de San Fernando or ''Banco Español de San Fernando'') was a financial institution created in Spain in 1829Gabriel Tortella, "Spanish Banking History, 1782 to the Present" 865:874 in Manfred Pohl, Sabine Freitag, ...

, began the process of establishing a Spanish banking apparatus adequate for

industrialization Industrialisation ( alternatively spelled industrialization) is the period of social and economic change that transforms a human group from an agrarian society into an industrial society. This involves an extensive re-organisation of an econo ...

and the transformation from

feudalism Feudalism, also known as the feudal system, was the combination of the legal, economic, military, cultural and political customs that flourished in medieval Europe between the 9th and 15th centuries. Broadly defined, it was a way of structur ...

capitalism Capitalism is an economic system based on the private ownership of the means of production and their operation for Profit (economics), profit. Central characteristics of capitalism include capital accumulation, competitive markets, pric ...

. Although not officially a bank of issue, it issued bonds that "were banknotes in all but name."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, . p. 866–867
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on

. 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. Among the main founders of the bank were

José de Salamanca José is a predominantly Spanish and Portuguese form of the given name Joseph. While spelled alike, this name is pronounced differently in each language: Spanish ; Portuguese (or ). In French, the name ''José'', pronounced , is an old vernacul ...

, Nazario Carriquiri,

Alejandro Aguado Alejandro is the Spanish form of the name Alexander. Alejandro has multiple variations in different languages, including Aleksander ( Czech, Polish), Alexandre (French), Alexandros ( Greek), Alsander ( Irish), Alessandro ( Italian), Aleksandr ...

, Gaspar Remisa, José Buschenthal, and Domingo de Norzagaray. The bank had initial capital of 100 million reales in

shares In financial markets, a share is a unit of equity ownership in the capital stock of a corporation, and can refer to units of mutual funds, limited partnerships, and real estate investment trusts. Share capital refers to all of the shares of an ...

and credits. 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 French (french: français(e), link=no) may refer to: * Something of, from, or related to France ** French language, which originated in France, and its various dialects and accents ** French people, a nation and ethnic group identified with Franc ...

and British financial institutions, some of which were its own creditors. It made many loans to insolvent companies, many owned by its own managers. Its risky approach to finance did not fare well. To save it from failure, on 25 February 1847 the Minister of Finance merged it with the much healthier

, 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 The Bank of Spain ( es, link=no, Banco de España) is the central bank of Spain. Established in Madrid in 1782 by Charles III of Spain, Charles III, today the bank is a member of the European System of Central Banks and is also Spain's national ...

.History of a Central Bank
, Banco de España, p. 6 (p. 8 of PDF). Retrieved 2010-03-03.
, Banco de España. Retrieved 2010-03-04.

Notes

{{DEFAULTSORT:Bank Of Isabella Ii Defunct banks of Spain