1901.] 



COMMEliCIAL JAPA^f. 



2297 



The V)ank receives deposits and makos advances in current accounts. The Bank of Japan does not pay interest on carrent depoeita. 

 Customers place their surplus money in the vault of the hank to secure the convenience of drawinj? checks upon it. The Ijanks of the 

 clearin<^-house association also settle their daily balances with their current accounts in the hank. Indeed, either in Tokyo or Osaka 

 the whole business of the clearing house is transacted in a room of the building of the Bank of Japan. The bank al.so it.sues dej^ogit 

 receii)ts, draft and transfer checks. The distribution of various kinds of coins and bank notes to the different districts of the Empire 

 constitutes no inconsiderable jjortion of the business of the bank. 



Hitherto the bank allowed loan and discount exclusively to bankers, being literally the bank of banks; but since June, 1897, the 

 way has been opened to deal directly with individuals and corporations which have good business standing. This measure ha." been 

 taken to extend the benefit of the low rate of interest to the general market, and to clieck the excessive profit often secure<l by other 

 bankers as a mere intermediary between the bank and the puV)lic. S(j at present the rates of interest announced by the bank are of 

 two sorts, namely, banker's rates and private rates. At present they are as follows: 



•Interest is counted so much a day per 100 yen. For instance, 2.5 means 2 .sen and 5 rin for 100 yen per day. 



The change of the rates of interest on loans and discounts is subject to the sanction of the minister of finance. Their movements 

 from week to week are carefully watched in commercial circles as indicating the state of the money-market. They are detennined not 

 to check the outflow of gold so much as it is in England, but they fluctuate chiefly with reference to the economic conditions at home. 



The Bank of Japan has no direct dealings in foreign markets, but it uses its sister institution, the Yokohama Specie Bank, as ita 

 foreign agent. Indeed, to encourage foreign commerce, the Bank of Japan assists this institution in many ways. Among other favors, 

 the former advances to the latter up the amount of 10,000,000 yen in rediscounting foreign bills at the rate of 2 per cent per annum. 

 Recently it has been proposed to increase the amount of this advance. The indemnity money lately received from China wa.< also trans- 

 ferred from London to Japan through this institution, either by the purchase of bullion or by exchang'^ operations. The whole sum of 

 money thus dealt with amounts to 363,446,464 yen, and this was carried within the space of only two years and a half. 



The total business transactions of the bank for 1898 were 9,019,330,231 yen. The discount of commercial paper amounts to 

 287,746,025 yen, representing 105,515 pieces of various kinds of bills. The advances upon securities amount to 128,060,910 yen, in 3,751 

 separate transactions. In current account 530,579,883 yen were paid and 532,530,150 yen were received. The range of thesf- di-scounta 

 and loans at one date fluctuate between a minimum of 55,134,193 yen and a maximum of 98,642,637 yen. Generally speaking, about 

 three-fourtli^ of this business is done in Tokyo and Osaka, while the rest is distributed among the other three branches and one 

 subbranch. The following figures will show the growth of business of the bank since its foundation: 



PERIODICAL REPORTS OF THE IJAN'K. 



The bank is required to advertise every week in the Official Gazette the average amount of its note issue. In the Bank of Japan, 

 as in the Bank of En<jland, the issue department is quite separated from the business department. Since January, 1897. the bank has 

 felt it acivisaljle to make public the statement of the condition of its business dei)artment at the close of every week. These two reports 

 are published every Wednesday in the Gazette. They are given herewith to show the latest condition of the bank. 



THE GOVERNMENT AND THE BANK. 



The Bank of Japan, being the only bank of issue, is not only placed under the control of the Government, but it L? heavily 

 burdened in return for the privileges granted. It has, as said before, to perform the following among other functions: 



(1) The receipt and disbursement of Government money. 



(2) The call and payment of the principal as well as the interest on the national debt. 



(3) The custody of money and the goods intrusted to the Government. 



(4) The redemption of the Government paper money. 



(5) The redemption of the national-bank notes. 



(6) The rediscounting of foreign bills of exchange for the Yokohama Specie Bank, at specially low rates. 



All these involve considerable sacrifice for the bank, but are done simply for the public convenience, as directed ^y the Government. 



For the management of the Government money there are established 44 treasuries in the principal towns of tlie Empire, and each 

 treasury has a certain number of subtreasuries. These are all placed under the control of the central treasury, which is in the bank. 

 Most of the treasuries are intrusted to other banks as agencies of the bank, which are paid for their management. 



In addition to all these, the bank is under an important obligation to support the public creilit in times of financial emeniency. 

 During the late war of 1894-95 it performed most valuable services for the country. Indeed, the war wouKl not have been jK>ssible 

 without the effective cooperation of the bank. At the commencement of the war the negotiation of a foreign loan was quite generally 

 favored in influential quarters. But the bank opposed this idea, and was fully confident that it could depend upon the internal 



