The Overseas Expansion of Japanese Banks, 1880–2006

Of all the countries of Asia it was Japan that pioneered international banking as an outgrowth of the needs of the domestic economy. The international activity of Japanese banks was a product of that country’s remarkable economic growth from the late 19th century onwards. Beginning with the Yokohama Specie Bank this saw Japanese banks establish branches in major financial centres around the world. From that basis these banks increasingly challenged European banks in the finance of Asia’s regional and international trade and in investment operations. This challenge was greatly strengthened by the effects of the First World War which undermined both European banks and European financial centres to the advantage of the Japanese and the Americans. However, economic nationalism between the wars and then the effects of the Second World War and Japan’s defeat forced a wholesale retreat of Japanese banks. Nevertheless, despite these setbacks Japanese banks again expanded rapidly from the 1960s onwards as the Japanese economy grew rapidly.

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