Background^*

After several initial attempts, in June of 1880, the Government created the Banco Nacional to act as its banker and to promote public credit. Its role as banker consisted of rendering to the Government the services of allotment of public or Treasury funds, the extension of credit, collaboration in obtaining both internal and external loans and the management of Government Securities. What’s more, the Banco Nacional was given the charge of issuing the national currency. However, in 1894, the National Bank was liquidated by the Congress due to registered excesses in the issuance of the currency. Years later, the Banco Central de Colombia was created and functioned between 1905 and 1909, until it too was liquidated for the same reasons.

The First World War brought in its wake severe economic and financial difficulties for Colombia that were not resolved with the advent of peace. The prospects of Colombian banking institutions during the first two decades of the 20th Century were not hopeful as a result of the reigning monetary disorder: currency was issued without control and bank reserves were diffuse. Aggravating this situation was the lack of a formal system of government guarantees and support for the banks.

The situation described above precipitated the economic slump of the years 1922 and 1923, a crisis that made evident the scarcity of money. The need to give solidity and stability to currency and credit by means of a solid and consistent central bank became imperative.

REFERENCES

The Bank
| Introduction | History, Mission and Functions |
| Organizational Diagram | Financial Statements |
| Notes and Coins | Fellowships |
| Foundations | General Information |