Foreign Banks of Issue in Prewar China: The Notes of the Netherlands Trading Society, Deutsch-Asiatische Bank and the International Banking Corporation

Abstract

To date, much of the scholarly literature on anti-foreign boycotts in prewar China focused on cigarettes. However, foreign banks were also targeted, particularly regarding their most visible infringement of Chinese sovereignty: banknotes. Piecing together note circulation data on the smaller European and American banks operating in Shanghai is a work in progress. In this research note, I present provisional data about three of the most important second-tier foreign banks in Shanghai: the Netherlands Trading Society, the German Deutsch-Asiatische Bank and the International Banking Corporation. Tentative conclusions can already be drawn. These banks by and large lost traction in the 1930s insofar as banknote circulation volumes were concerned. On the other hand, the political vacuum that befell the Chinese market following the downfall of the Qing was the single biggest boon of the banks under review. The redemption freeze on Chinese bank notes of 1916 seems to have had a partial effect in terms of regaining Chinese trust in Chinese banknotes at the expense of foreign ones. Unlike British banks, Netherlands Trading Society circulation figures never recovered in the early 1920s. Needless to say, much more work can be carried out in that regard as the pertinent archives are situated right around the world.