BPI was established on August 1, 1851 as the "El Banco Español Filipino de Isabel II" (), named after the Queen of Spain, Isabella II, the daughter of King Ferdinand VII. It was the first government bank in the Philippines and the third Philippine bank during the Spanish era. One of the founders and primary shareholders at that time was José Joaquín de Ynchausti of Ynchausti y Cía, a prominent Philippine multi-national conglomerate who also founded Tanduay Distillery and built the Puente Colgante. José was the managing director of the bank from 1868 to 1873 and 1876 to 1884.