CIRJE-F-610 "The Activities of a Japanese Bank in the Interwar Financial Centers: A Case of the Yokohama Specie Bank"
Author Name Kasuya, Makoto
Date January 2009
Full Paper PDF file
Remarks @ Subsequently published as "The Activities of Japanese Banks in the Interwar Financial Centers: The Cases of the Yokohama Specie Bank's Offices in London and New York", in Shizuya Nishimura, Toshio Suzuki, and Ranald Michie eds., The Origins of International Banking in Asia: The Nineteenth and Twentieth Centuries, Oxford University Press, 2012, pp. 196-216.
Abstract

This paper aims to analyze the role of a branch of a Japanese bank in the internationals financial centers and its change during the Interwar period. Branches of international exchange banks generally buy bills for goods exported from where they exist, to collect bills for goods imported to where they exist, and to transfer funds with other branches. In addition to these "ordinary" businesses branches in the international financial centers raise funds by selling bills there or by borrowing money from other banks, to makes investments for securing reserves, and to advise letters of credit issued by large banks there. This paper sheds light on these activities of the Yokohama Specie Bank, which was the largest international exchange bank in Japan before the Second World War and shows that branches in London and New York facilitated the flow of funds within the bank. The Interwar period saw significant change in international money flow as New York grew to an international financial center, which was as important as London and also saw the Great Depression and international conflicts after that. This paper analyzes how businesses of the two branches changed in order to cope with turbulence in the financial markets.