Chapter 47 Section 7 Currency of Commercial Banks and Other Financial Organizations

In the 23rd year of Guangxu (1897 A.D.), the Qing government agreed to the establishment and issuance of banknotes by China Commercial Bank amidst calls for China Construction Bank to issue banknotes.This is the first commercial bank in China, followed by Zhejiang Industrial Bank, Siming Commercial Savings Bank and Zhejiang Local Bank, commonly known as "Southern Four Banks".At the same time, Xincheng Bank and Xinyi Bank were established for the purpose of flaunting savings.The largest commercial banks in the South include Xinhua Bank, Shanghai Commercial Savings Bank, Zhejiang Construction Bank and so on.Pingjin's North Four Lines, that is, Zhongnan, Salt Industry, Mainland, and Jincheng Four Lines are also relatively powerful.In addition, the Chuanbang, Guangbang, Ningshaobang, Huaiyangbang, Sunanbang, and provincial commercial banks, as well as banks jointly established by government and business, and Sino-foreign joint ventures, all issued their own banknotes. Before May 1949, there were more than 260 commercial and local banks open to the public in Shanghai.Some reputable commercial banks have bonds with Bank of China and Bank of Communications.It was not until the mid-1930s that the right of commercial banks to issue banknotes was gradually abolished.During the Anti-Japanese War, in order to deal with the invasion of the enemy and puppets and to extract legal currency, commercial banks and other financial organizations near the areas occupied by the enemy and puppets were licensed to issue banknotes on the spot.Banks, money stores, money shops, and business houses each issued notes in the nature of banknotes. In some towns, officials and gentry randomly issued paper notes for local use.These conditions were particularly acute in the 1920s.Some houses state in their business regulations that they have distribution rights without official approval.Some engaged in public debt speculation, and some closed down due to the impact of the war, and they were not responsible for the banknotes issued.At that time, the Beiyang government was beyond its reach, and the local government could not handle it.It was not until the 1930s that it changed into a number of group-type gangs, some of which were gradually controlled or annexed by the Four Banks and Two Bureaus, forming a financial group with the central bank as the core.