When the tub was installed,in the 20s and 30s, there was NO diverter. The diverter was part of a remodel. Originally, there were 3 knobs on the wall but the middle one operated the drain fitting, which is what that handle below the current valve does. The drain is what is called an "indirect overflow" because the water in the tub fills the overflow tube until it reaches the top of the center "plug"" and flows over its top down and down the drain. Once they designed the overflow that way, they did not need an opening for it in the tub. Initially, as in your tub, the spout was installed to fill that hole but, in some cases the spout opening is about 6" above the bottom of the tub which would make it impractical to use as an overflow. They became "illegal" as soon as engineers realized that if the tub was filling, and the spout was under water, it would drain out through the water lines if the building water supply was turned off.