ed on the new-currency basis. Many
retailers followed the lead, and the acceptance of the new medium
thenceforth greatly increased. Still, for several months, provincial
natives were loth to part with their old coin at a discount, or, as
they plainly put it, lose 10 to 20 per cent. of their cash capital
at a stroke. The Insular Treasurer therefore issued another circular
in December, 1904, stating that whosoever engaged in business should
make use of the old coinage in trade transactions after December 31,
1904, without special licence, would be condemned to pay not only
that licence, but a heavy fine, or be _sent to prison_; and that
all written agreements made after October, 1904, involving a payment
in old currency, would pay a tax of 1 per cent. per month from the
said date of December, 1904. Nevertheless, further pressure had to be
exercised by the Civil Governor, who, in a circular dated January 7,
1905, stated that "it is hereby ordered that the Insular Treasurer
and all provincial treasurers in the Philippine Islands shall, on and
after this date and until February 1, 1905, purchase Spanish-Filipino
currency, Mexican currency, Chinese subsidiary silver coins, and all
foreign copper coins now circulating in the Philippine Islands at
_one peso_, Philippine currency, for _one peso and twenty centavos_,
local currency."

As late as March, 1905, there was still a considerable amount of old
coinage in private hands, but practically the new medium was definitely
established. The total number of "Conant" pesos in circulation in
the Islands, in the middle of May, 1905, was 29,715,720 (all minted
in America), and "Conant" paper, P10,150,000.

From the time of the American occupation up to May, 1902, the two
foreign banks--the Hong-Kong and Shanghai Banking Corporation and
the Chartered Bank of India, Australia, and China (_vide_ Banks,
p. 258)--were the only depositaries for the Insular Treasury, outside
the Treasury itself. In the meantime, two important American banks
established themselves in the Islands--namely, the "Guaranty Trust
Company," and the "International Banking Corporation." On May 15,
1902, the "Guaranty Trust Company" was appointed a depositary for
Philippine funds both in Manila and in the United States; and on June
21 following the "International Banking Corporation" was likewise
appointed a depositary for the Insular Treasury, each being under a
bond of $2,000,000. These two banks also act as fiscal