A Study On The Central Reserve Bank Of China

After invasion into China, to coordinate the exercise of commodity control and industrial control in occupied area of Central China, Japan propped up Wang's puppet government and established the Central Reserve Bank of China (CRBC), whose financial control became the dominated economic activity of Wang's puppet government. Central China, centered in Shanghai, was the traditional important financial place, with the united monetary system and flourishing finance. Therefore, it was rather difficult for CRBC to eliminate the influence of financial setup of KMT bank system and exercise the function of CRBC. During the day from the establishment of CRBC in January 1941 to take-over by KMT in September 1945, CRBC gradually expanded the influence and strengthened the regulation and control as Japanese army moved forward into Central China. Not until Pacific War broke up and Japan controlled completely concessions in Shanghai, squeezing out foreign financial force (e.g. Britain and America )in Central China did CRBC, backed up by Japan's political and military force, broke away from all kinds of obstructions to exercise exclusive financial control. CRBC constructed a financial network around itself by the means of establishing branches and reshuffling the KMT banks. In Central China and even occupied area of South China, it carried out a series of financial activities: unifying new monetary, reinforcing financial setup and fund control, rushing to purchase commodities, and borrowing bonds. These activities extorted a large sum of wealth, impeded severely the normal development of private industry and commerce, and inflicited heavy losses on prosperity of banking in Central China. Meanwhile, large sums of bank notes issued recklessly by CRBC caused serious inflation. CRBC's financial control was absolutely an financial catastrophe, bringing about a very bad influence. Under Japan's manipulation, CRBC was no longer the bank only confined to puppet regime and raised funds for Japanese war of aggression. The establishment and activities of CRBC attained Japan's vicious goal of "maintaining war by war" and satisfied the heavy expenditure of Wang's puppet government. However, it also provides the irrefutable evidence of Japan's economic pillage in Central China.