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NOTOFILIA Numismatics and Notaphily
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Published

Origins of Commercial Banking in Puerto Rico

From the Spanish peso to the dollar: how issuing banks were born in Puerto Rico with the Banco Español de Puerto Rico, and what changed after 1898.

Reviewed by
Yezid Acosta
Period illustration of a nineteenth-century colonial street in Puerto Rico in front of the Banco de San Juan, with two men exchanging a banknote
Period illustration of a nineteenth-century colonial street in Puerto Rico in front of the Banco de San Juan, with two men exchanging a banknote

The history of banking in Puerto Rico is marked by its double colonial heritage: first Spanish and, from 1898, American. That transition was stamped on its banknotes and coins, which makes the island especially rich ground for notaphily.

Spanish Puerto Rico and its money

Until the late nineteenth century Puerto Rico was an overseas province of Spain. For generations a mixed metallic currency circulated on the island: Spanish colonial pieces, worn cobs, and foreign coins that arrived with trade. The shortage of a stable, trusted circulating medium was a recurring problem for the island economy and prepared the ground for a formal banking institution.

The Banco Español de Puerto Rico

The Banco Español de Puerto Rico, established in 1888 by royal provision, is usually considered the island’s first issuing institution. Besides the functions of a commercial bank —deposits, loans, and discount— it received the right to issue notes denominated in pesos, finally giving Puerto Rico its own organized paper money.

The Puerto Rican peso

In parallel, around 1895 a provincial coin specific to the island was struck, the Puerto Rican peso, with silver fractions. The Banco Español notes and these provincial coins formed a monetary system distinct from the peninsular one, designed for local commerce.

1898: from the peso to the dollar

The Spanish–American War and the Treaty of Paris of 1898 placed Puerto Rico under United States sovereignty. One of the most immediate and sensitive consequences was monetary: the Puerto Rican peso was withdrawn and replaced by the U.S. dollar, in an exchange at an unfavorable rate that meant a loss of value for many inhabitants of the island.

From Banco Español to Banco de Puerto Rico

The founding institution itself reflected the change of era: the Banco Español de Puerto Rico was renamed Banco de Puerto Rico in 1913, fully integrated into the dollar system. Its issues of the last decades of the nineteenth century and the beginning of the twentieth rank today among the most prized pieces of Caribbean notaphily.

For the collector

The notes and coins of this period are tangible testimony of Puerto Rico’s passage from Spanish colony to U.S. territory. An emblematic example is the 1-peso exchange note of 1895, issued by the Ministerio de Ultramar in the last years of Spanish sovereignty. You can explore more examples in our Puerto Rico banknote catalog.

1895 one-peso exchange note of the Ministerio de Ultramar, obverse and reverse
One-peso exchange note of 1895 (Ministerio de Ultramar). Notofilia collection.

Sources

  • Standard Catalog of World Paper Money (Albert Pick), Puerto Rico section, for cataloguing Banco Español de Puerto Rico issues.
  • Studies of the monetary and banking history of Puerto Rico and the Spanish Caribbean in the nineteenth and twentieth centuries.
  • Historical archives on the Treaty of Paris (1898) and the peso-to-dollar transition in the Antilles.

Editorial policy, sources, and valuation

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