Preface

Summary

Eleven of the top twenty international banks in the world in 1992 were Japanese, and yet on 1 July 1859, when the treaty port of Yokohama was finally opened to the importunate westerners, Japan had no companies which could undertake modern banking business. The present book will chart the course by which the Japanese transformed their early proto-banking into a modern banking system which would compete with, and ultimately outclass, that of other nations.

It should be noted that nineteenth-century Japanese treaty ports, which Japan in her weakness was forced to concede, were, however, never bridgeheads from which foreigners could penetrate into Japan, but rather enclaves into which the foreigners were penned. Foreign banks, originally British, represented in Yokohama and at other treaty ports from the 1860s, were doing business on the periphery of a country which was for all intents and purposes barred against them. Within Japan proper various banking experiments were undertaken as the new Meiji government, from 1868, struggled to create a new system of currency by repressing the debased coins of the old Tokugawa regime as well as by replacing the paper currency (hansatsu) of nearly two hundred and fifty clan governments. The resultant inflation caused much suffering and hardship as, for nearly a quarter of a century, the Japanese plunged from one ill-conceived banking experiment to another. It was Shigenobu Okuma, who had himself never experienced the sophisticated banking system of a western country, who presided over the financial muddle which existed in Japan at that time.