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In 1901, both the American military and civil authorities decided upon the establishment of a “leper” colony. A military board sought an isolated place. The sparsely populated Culion Island was judged suitable for the purpose.
To avoid the use of ordinary legal tender by the patients, the government in 1913 provided for a special coinage backed by an equivalent amount set aside in the treasury. The first issue, of six denominations (1 peso and 20, 10, 5 and 1 centavo, also 1/2 centavo), was of aluminum, as also was a further partial issue made in 1920. That metal was found disadvantageous because of corrosion by antiseptics; when mercuric bichloride was used the coins simply disappeared. The more recent (partial) issues, in 1922, 1925, 1927 and 1930, were of nickel.
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