Bank of Chōsen
A colonial bank of issue and commercial bank that operated in Korea and across parts of East Asia from 1909 until its liquidation after the establishment of successor central banks.
Last updated November 4, 2026
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Overview
The Bank of Chōsen was a colonial financial institution established in 1909 through the reorganization of Japan's Dai-Ichi Bank operations in Korea. It initially operated under the name Bank of Korea and was renamed the Bank of Chōsen after Japan's formal annexation of Korea in 1910. The institution combined the functions of a central bank and a commercial bank: it issued currency, managed reserves, supported domestic and foreign trade, conducted gold-purchasing operations, and extended credit to governments and businesses. Its notes circulated not only in Korea but also in territories connected to Japan's expanding political and economic sphere, including the Kwantung Leased Territory and areas of Manchuria. The bank was created against the background of Japan's growing control over Korea following the 1905 protectorate treaty. Japanese officials debated whether Korea should receive a dedicated central bank or simply a branch of the Bank of Japan. The dedicated-bank model ultimately prevailed, partly because it was viewed as more suitable for local financial administration and partly because it allowed Japanese authorities to maintain direct institutional control. Dai-Ichi Bank transferred most of its Korean network, staff, operations, and certain assets to the new institution. The Bank of Korea inherited responsibility for notes previously issued by Dai-Ichi Bank and became the principal monetary institution in Korea. After the 1910 annexation, the renamed Bank of Chōsen operated within a legal framework modeled on the Bank of Japan, although it had distinctive colonial functions. Its notes could be exchanged at par with Bank of Japan notes and were legal tender in Korea and selected Japanese-controlled territories. During the 1910s, the bank expanded rapidly beyond Korea. It opened offices in Manchurian and Chinese cities, acquired or absorbed parts of the Yokohama Specie Bank's Manchurian operations, supplied gold to Japan's Osaka Mint, and acted as a fiscal agent for Japanese authorities. The expansion made it an important instrument of Japanese economic penetration in Northeast Asia, and historians have characterized it as a major component of Japanese imperial expansion. The institution suffered substantial losses when its Tokyo branch was destroyed in the Great Kantō earthquake of 1923. Japanese authorities and the Bank of Japan provided long-term support, while legislation enacted in 1924 changed the bank's governance. The Governor-General of Chōsen lost his previous supervisory role, direct oversight shifted to Japan's Ministry of Finance, and the head office and senior management moved to Tokyo. Regional directors in Keijō and Dalian managed the bank's Korean and Manchurian operations respectively. By the end of the 1920s, the bank maintained one of the largest overseas networks among Japanese financial institutions. The bank later reduced its direct presence in Manchuria after the creation of the Central Bank of Manchou and the Manchurian Industrial Bank. It nevertheless continued to participate in Japanese-controlled financial structures, including the Chi Tung Bank in East Hebei. After the outbreak of the Second Sino-Japanese War in 1937, it acted as a financial agent for the Japanese military and established offices in occupied Chinese cities. Its workforce became increasingly Korean as wartime mobilization expanded, although senior governance remained dominated by Japanese authorities. Japan's surrender in 1945 and the division of Korea ended the bank's unified territorial role. Its northern branches came under Soviet and then North Korean control and were used in the creation of North Korea's central banking institution. In the South, the Bank of Chōsen continued to operate under the United States Army Military Government and issued currency during the transition to statehood, but its activities contributed to severe monetary instability and inflation. South Korean legislation promulgated on 5 May 1950 created the Bank of Korea and transferred to it the former Bank of Chōsen's assets and operations. The Bank of Chōsen was placed into liquidation, partly to separate the new central bank from potential claims by Japanese stakeholders. Its Japanese assets were nationalized in 1945 and later became part of the institution that was eventually known as Aozora Bank.
History
The Bank of Chōsen originated in Japan's effort to reorganize the financial infrastructure of Korea after the 1905 protectorate arrangement. Dai-Ichi Bank had operated extensively in Korea since the late nineteenth century, but Japanese officials debated whether those activities should remain within a private commercial bank, be transferred to a Bank of Japan branch, or be placed under a specialized institution. A dedicated Bank of Korea was established under Japanese legislation in July 1909. Dai-Ichi Bank transferred its Korean branches, personnel, note liabilities, reserves, and a partially completed Seoul headquarters building to the new institution. Ichihara Morihiro, who had managed Dai-Ichi's Korean network, became its first president. Following Japan's annexation of Korea in 1910, the institution was renamed the Bank of Chōsen in March 1911. It operated as a bank of issue while also conducting ordinary commercial banking. Its notes circulated in Korea and in several adjacent Japanese-controlled territories, and could be exchanged at par with Bank of Japan notes. Unlike a conventional independent central bank, its governance was closely tied to the colonial administration and Japanese financial authorities. It helped regulate prices, finance trade, administer reserves, purchase gold, and provide credit to public bodies and commercial enterprises. During the 1910s, the bank developed a substantial regional network. Branches were opened in cities including Mukden, Dalian, Changchun, Harbin, Qingdao, Shanghai, Manzhouli, and Qiqihar. In 1917 it took over the Manchurian operations and note-issuing privilege of the Yokohama Specie Bank while that bank retained commercial activity. The Bank of Chōsen also acted as a fiscal agent in the Kwantung Leased Territory and extended direct lending to the Fengtian government. Its gold-purchasing and assaying network made it a major supplier of gold to Japan's Osaka Mint. The bank's activity in Manchuria became more profitable than its Korean business, reflecting the broader role of finance in Japan's continental expansion. The financial downturn after 1920 led to a reduction in Manchurian lending and note issuance. The 1923 Great Kantō earthquake then destroyed the Tokyo branch and imposed heavy losses. The Japanese Ministry of Finance and Bank of Japan responded with long-term financial assistance. Legislative changes in February 1924 removed the Governor-General of Chōsen from his previous governance role and placed the bank under the Ministry of Finance. In May, the head office and senior management moved to Tokyo, while directors in Keijō and Dalian supervised Korean and Manchurian activities. By 1929, the bank had 19 offices outside Japan and its colonies, giving it one of the largest overseas networks among Japanese banks. The creation of Manchukuo's central financial institutions altered the bank's regional strategy. In 1936, a jointly owned Manchurian Industrial Bank assumed the Bank of Chōsen's Manchurian branches, numbering about sixty when combined with branches transferred from other institutions. The Bank of Chōsen nevertheless expanded into North China through the Chi Tung Bank, created for the East Hebei Autonomous Government. When war began in 1937, it served as a financial agent of the Japanese Army and opened offices in captured cities, extending the colonial financial system into occupied territory. The institution's role made it an important mechanism of Japanese imperial finance, while also associating it with the coercive political and military order of the period. The end of Japanese rule in 1945 split the bank's institutional legacy. Eight branches north of the 38th parallel came under Soviet control and were used to establish a temporary monetary office and then North Korea's central bank. In South Korea, the institution continued under the United States Army Military Government. It supplied funds for the occupation administration and issued currency, but the postwar monetary environment was marked by inflation and institutional uncertainty. South Korean authorities debated whether to retain the Bank of Chōsen or use another existing bank as the basis for a national central bank. The Bank of Korea Act, promulgated on 5 May 1950, resolved the issue by creating the Bank of Korea and transferring the predecessor's southern assets and functions to it. The Bank of Chōsen was liquidated. The bank's Japanese assets were nationalized in 1945. Elements of those assets later supported the establishment of Nippon Fudosan Bank in 1957, which became Nippon Credit Bank in 1977 and was eventually privatized as Aozora Bank in 2001. The former Seoul headquarters, designed by Tatsuno Kingo and completed in 1912, survived wartime damage after reconstruction and now houses the Bank of Korea Money Museum.
- 1950
Bank of Korea replaces Bank of Chōsen in South Korea
[3]The new South Korean central bank received the predecessor's southern assets and operations, ending the Bank of Chōsen's existence.
- 1945
Operations divided after Japan's surrender
[3]Northern branches came under Soviet and North Korean control, while southern operations continued under the U.S. military government.
- 1937
Military-finance role expands during the Second Sino-Japanese War
[3]The bank became a financial agent of the Japanese Army and expanded into occupied Chinese cities.
- 1936
Manchurian branches transferred to the Manchurian Industrial Bank
[3]A jointly owned institution took over the bank's direct Manchurian branch network.
- 1924
Governance centralized under Japan's Ministry of Finance
[3]New legislation ended the Governor-General's former governance role and the head office moved to Tokyo.
- 1923
Tokyo branch destroyed by earthquake
[3]The Great Kantō earthquake caused major physical and financial damage.
- 1917
Manchurian operations acquired from Yokohama Specie Bank
[3]The bank took over selected Manchurian branches and the associated note-issuing privilege.
- 1913
Expansion into Manchuria
[3]The bank opened offices in Mukden, Dalian, and Changchun, beginning a major expansion beyond Korea.
- 1911
Renamed Bank of Chōsen
[3]Japanese law changed the institution's name after the annexation of Korea.
- 1910
Korean yen issuance begins under the new institution
[2]The bank assumed responsibility for currency circulation and continued issuing notes after Japan's annexation of Korea.
Products and positioning
Colonial central bank and commercial-finance institution
Currency issuance · 1909
Bank of Chōsen banknotes
The bank issued notes used as legal tender in Korea and, at various times, in Japanese-controlled territories beyond Korea. Its notes were exchangeable at par with Bank of Japan notes and formed the principal paper-currency system of colonial Korea. Issuance expanded as the institution extended its network into Manchuria and other parts of East Asia.
Central banking · 1909
Central banking services
The bank managed currency reserves, supported monetary circulation, influenced domestic prices, facilitated trade settlement, and performed other central-bank functions. Its reserve rules allowed Bank of Japan notes alongside gold and silver, reflecting its integration into Japan's wider monetary system.
Banking · 1909
Commercial and government lending
Alongside its monetary role, the institution provided commercial credit and loans to public authorities. Its lending supported trade, industrial activity, colonial administration, and Japanese strategic interests, including direct lending to the Fengtian government in Manchuria.
Precious-metals finance · 1910
Gold purchasing and assaying
The bank bought gold and operated or inherited assaying facilities in Korea and Manchuria. Its network made it a significant supplier of gold to Japan's Osaka Mint during the 1910s.
Brand decisions
1950
Transfer South Korean operations to the Bank of KoreaStrategyBackground
The newly independent South Korean state required a national central bank separate from the colonial institution and potential Japanese claims.
Action taken
Legislation established the Bank of Korea, transferred the Bank of Chōsen's southern assets and functions, and placed the predecessor into liquidation.
Aftermath
The Bank of Korea became South Korea's monetary authority, while the Bank of Chōsen ceased to exist.
1936
Transfer direct Manchurian branch operationsStrategyBackground
The establishment of Manchukuo's own financial institutions reduced the need for the Bank of Chōsen to operate a large direct branch network there.
Action taken
A 50-50 venture with the Manchukuo government, the Manchurian Industrial Bank, assumed the bank's Manchurian branches.
Aftermath
The Bank of Chōsen retreated from direct Manchurian retail and branch activity but retained a role in regional imperial finance.
1924
Move the head office to Tokyo and restructure governanceStrategyBackground
The bank faced losses after the 1923 earthquake and required support from Japan's financial authorities.
Action taken
Legislation placed the bank under the Ministry of Finance and relocated its head office and senior leadership to Tokyo.
Aftermath
Regional management was divided among Tokyo, Keijō, and Dalian, increasing central Japanese oversight.
1917
Take over selected Yokohama Specie Bank operations in ManchuriaStrategyBackground
Japanese authorities sought to consolidate note issuance and fiscal operations in the Kwantung region.
Action taken
The Bank of Chōsen acquired the other bank's Manchurian note-issuing privilege and several branches, while Yokohama Specie Bank retained commercial activity.
Aftermath
Bank of Chōsen notes circulated more widely in Manchuria and the institution strengthened its role as a Japanese fiscal agent.
1911
Rename the Bank of Korea as the Bank of ChōsenStrategyBackground
Japan's annexation of Korea changed the territory's legal and administrative status.
Action taken
The institution was renamed under Japanese law and continued as the colonial bank of issue and commercial bank.
Aftermath
The bank became a central element of Japan's monetary administration and economic expansion in Korea.
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