is a Japanese bank headquartered in Tokyo. It is a corporation held by Japan Post Holdings, in which the government of Japan has a majority stake.
It is a major financial institution that started in 1875 as a postal savings system, and that still today continues to operate primarily out of post office branches. It manages over ¥205 trillion of assets and offers services in almost 24,000 branches across Japan. At times in its history, it was the largest financial institution in the world. Since its conception, it has played a significant role in both making economic services to people in Japan and making investments towards the economic and industrial development of the country.
Throughout the vast majority of its history, Japan Post Bank had always been fully government owned and organizationally a part of the postal system. In 2007, a bill was passed to begin the privatization of Japan Post Bank and to create separate companies to handle the distinct responsibilities of Japan Post. The government's sale of its shares in Japan Post Bank and its holding company are still ongoing.
Organizational history
The postal savings system in Japan was started in 1875 by Maejima Hisoka, who is known as "the father of the Japanese postal system." Before he founded the postal system as a whole four years before in 1871, Maeijima had spent time observing the postal system of the United Kingdom and was impressed by its offering of postal savings services. Adoption by the public was rapid, with 10,000 customers within the first three years of operation.
After World War II, in 1949 the postal savings system was relaunched under the newly formed Ministry of Posts and Telecommunications. As the economy recovered, postal savings grew to tremendous sums, reaching ¥1 trillion in 1960 and ¥100 trillion in 1985. In 2001, the postal savings system came under the jurisdiction of the Postal Services Agency, which soon reorganized into Japan Post in 2003.
Through all these organizational changes, the postal savings services were managed by a single government-owned company that also handled significant postal and insurance divisions. In 2006, Japan Post Holdings was founded as a government-owned holding company in preparation for the division of these responsibilities into separate companies with partial private ownership, a reorganization which occurred on October 1, 2007. On November 3, 2015, the shares of Japan Post Bank Company debuted for the first time on the Tokyo Stock Exchange, with about 10% of shares listed.
Historical role in economic development
The importance of the Japanese postal banking system lies not just in providing a savings vehicle and financial services to the people of Japan, but also in the use of the saved funds to promote economic development throughout modern Japan's history.
Founding through World War II
Postal savings were first deposited in the , a private bank that issued currency, but starting in 1878 deposits were made to Ministry of Finance, which became the exclusive destination for deposits in 1884.
This was during the Meiji Restoration, when the Japanese government was focused on encouraging economic and military modernization and avoid foreign debt to remain independent during a period of Western colonialism. A particular concern was foreign debt, as observers in Japan saw indebtedness in countries like China and Egypt leading to their subordination to their creditors.
However, this transformation required large amounts of capital to finance as railways, communications systems and industrial development in a country with a low savings rate because a large majority did not see money as something to be saved and invested. Postal banking became a success, and by 1885 it had 1.25 million depositors who could make financial transactions at around 4500 post office branches.
At the beginning, deposits were lent exclusively to the government through the purchase of government bonds. In the 1890s, the government starting creating several banks that could offer industrial loans backed by these deposits. However, this type of lending only became notable after 1912, and only by the 1930s did it become the type of system which would become important after the war that lent funds to specific institutions to achieve developmental objectives.
In the lead-up to and during World War II, postal savings were invested in companies involved in wartime production and government bonds, which were issued in significant amounts to finance the war effort. This period saw postal savings grow at its highest rate ever, quintupling between 1942 and 1945.