The country’s first bank – Bank of the Philippine Islands (BPI) – celebrated its 171st anniversary today with an anniversary mass officiated by Most Rev. Fr. Honesto F. Ongtioco, D.D. Bishop of Cubao, at its satellite office in Buendia Center, Makati.
BPI, which continues to lead in the banking and financial industry today, was established by the Junta de Autoridades on August 1, 1851. The Junta was created in 1828 by a royal decree of King Ferdinand VII of Spain and was composed of a Manila-based committee of civil and ecclesiastical officials.
Originally named Banco Español de Isabel II (after Spain’s then reigning monarch), the bank’s original capital was provided by “Obras Pias” – a foundation that handled charitable contributions to the Catholic Church.
Among its original stockholders was Antonio de Ayala, a prominent businessman and the forebearer of current BPI Chairman Jaime Augusto Zobel de Ayala (JAZA). The Church had been its most dominant shareholder up until 1968 when Ayala became the bank’s largest shareholder.
Today, some of the best names in global finance have been BPI shareholders. JP Morgan took a 20% stake in 1974, which was later bought by DBS Group Holdings – Singapore’s biggest bank – in 1999. Later, the Government Investment Corporation of Singapore acquired a portion of DBS’ stake in 2014.
Thereafter, acquisitions complemented BPI’s organic growth, as follows: People’s Bank in 1974, Com trust in 1980, Family Savings Bank in 1984, Citytrust in 1996, Far East Bank in 2000, and Prudential Bank in 2005.
A number of FIRSTs in banking history
BPI also notched a number of “firsts” in its history: BPI made its first loan to a Filipino-Chinese merchant in 1851. In 1864, BPI lent money to the colonial government, which was used to build Arranque Market and Hospital de San Juan de Dios. In 1888, BPI also financed Jacobo Zobel’s Compania de Tranvias de Filipinas, the steam-operated railway that replaced horse-drawn carriages.
BPI also issued the Philippines’ very first banknote in 1896.
According to Money and Banking in the Philippines, BPI was given, by a royal decree, the monopoly of issuing notes to the extent of three times its capital stock worth 1.5 million pesos. Its banknotes were in denominations of 5, 10, 25, 50, 100, and 200 and were designated as Pesos Fuertes which were payable in either Mexican or Spanish-Filipino silver coins. The banknotes were jointly used with Mexican peso coins, the Alfonsino pesos, and the Spanish-Filipino silver coins.
In 1982, BPI pioneered electronic banking. It introduced the first ATM network in 1990, established the first banc assurance company in 2000, put up the first mobile microfinance institution in 2009, and was able to build its its first solar-powered bank branch by 2013. In 2016, its BPI Capital led the issuance of the P10.7 billion Aboitiz Power climate bond – the first for geothermal energy and the first “green bond” among peer nstitutions. Currently in the works is a proposed transition financing for a coal-operated plant, which will enable the power company to terminate its coal operations 15 years ahead of schedule.
Today, BPI has also continued to engage the community on several fronts:
— BPI Foundation has directly engaged and advanced financial wellness, financial inclusion, financial literacy, and sustainable development.
— The BPI-DOST Science Awards continue to provide the country’s brightest students a platform for presenting and implementing their science and technology-based business concepts.
— BPI also nurtures the civic spirit of its employees through the ‘BPI Bayan Volunteerism Program.’ Over the years, BPI staff have contributed thousands of volunteer hours to their assist targeted communities in providing concepts, organizing and undertaking fund-raising activities, as well as implementing self-help projects.
In a statement, Mr. Jose Teodoro “TG” Limcaoco, BPI’s president and CEO, said that BPI’s growth strategy is anchored on the following principles: 1) Establishing BPI as “the undisputed digital leader in banking;” 2) Increasing the share of SMEs and consumer loans in BPI’s loan book; 3) Closing the gap in funding leadership; 4) Redefining the new role of the bank’s branches; 5) Promoting sustainable banking; 5) Being always on the lookout for customer excellence.