‘Note-issuing provincial banks and the formation of the Spanish financial system, 1844-1874’

The formation of modern financial systems is increasingly regarded as among the main drivers of development processes, both those dating from the 18th and 19th centuries and those initiated thereafter.

Specialist studies in the area bear out the importance of historical precedents in the configuring of national financial systems. Even today, despite the effects of globalization, we still find marked disparities between the financial systems of different countries, which can only be attributed to the survival of structures that began to take shape over a century ago.

The evolution of each country’s financial system has been strongly influenced by changes in the legal framework and by government decisions. It is accordingly necessary to analyze the role of the state and the goals informing policy action.

In Spain’s case, there are a number of gaps in our knowledge of how the financial system took shape. The study of the creation and development of local note-issuing banks and their role in the formation of the modern financial system has traditionally been approached from two main angles: through monographic studies on individual banks and, to a far smaller extent, from a global standpoint.

This project will explore the overall role of note-issuing provincial banks in the development of the Spanish financial system and how they contributed to the economic progress of nineteenth-century Spain. The existing literature needs to be revisited in certain cases and supplemented by primary evidence in others, while it will also be necessary to set clear and meaningful analytical objectives to attain a global understanding of the phenomenon.

This calls for at least the following tasks: a detailed study of the evolution of banking legislation; an examination of the social and economic conditions in place when these banks were being founded and the personality of their promoters; a systematic financial analysis of the banks’ activity; an assessment of their key financial variables and impact on the local and national economy; and a comparison between the development of Spanish banking and the experience of other countries.

 The ultimate goal of the project is to prepare a book combining an analytical overview with individualized profiles of each institution.