Shanghai Commercial and Savings Bank
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The Shanghai Commercial and Savings Bank was a truly modern Chinese financial institution during the first three decades of the twentieth century. Thank's to the vision and innovative spirit of it's founder K. P. Chen, it became China's first modern savings bank.
[edit] Founding of the bank
The Shanghai Commercial and Savings Bank was founded by a famous banker, Chen Guangfu, better known as K. P. Chen, in Shanghai in June 1915, with the guiding principle of “service to society, support for industry, and prosperity to enhance international trade.” Its aims were to encourage savings and to accumulate social capital to provide both the public and the industry with needed funds. Mr. The-Chin Chuang was elected the first chairman, and the founder, Mr. Chen, was the first president.
[edit] Values
Since its inception, the Bank has upheld its principles of service and innovation. Especially, the Bank placed great emphasis on staff education. Through the years, the Bank has attracted customers by meeting social needs and promoting businesses to assist in the country’s social development. The Bank aggressively developed innovative financial products, such as the one-dollar saving account, small loan secured by credit, collateralized loan of commodities, railroad freight documentary, and unit system. As a result of its innovation and service orientation, deposits rose and the Bank won public praise as well.
[edit] Early years
In 1931, the Bank completed the construction of its head office building in Shanghai, which was the most modern banking edifice in China at that time. The Bank started its business with a capital of less than 100,000 silver dollars and with a workforce of four. In 1934, the Bank had become the nation’s top private bank, with employees over 2,700 and branches over 110.
During World War II, the Bank, with a new board of directors and supervisors, moved its head office to Chongqing, the wartime capital of Chinese resistance. The head office remained in Chongqing until the end of the war. In addition, the Bank extended its banking network from the southeastern, middle, and northern parts of the country, to the southwestern and northwestern parts. Unfortunately, due to political reasons, the Bank was forced to shut down in 1950.
In 1954, the Bank accompanied the government to Taiwan and was allowed to establish the head office in Taipei to prepare for the resumption of business. It was not until June 1965 that the Bank was approved to restart its operation in Taipei with a capital of NT$15 million. Mr. Chen was the chairman. The Bank was the only private Mainland bank to relocate to Taiwan. During the resumption, the Bank acted conservative. The Savings Department and Kaohsiung Branch were set up in 1966 and 1971, respectively.
[edit] New era
In July 1976, the founder Mr. Chen passed away. Mr. Ju-Tang Chu succeeded. In September 1981, the Bank moved into its new head office building in Jen-Ai Road. In 1983, Mr. Hung-Ching Yung was chose as the vice chairman. Mr. Yung helped steer the Bank toward faster expansion and greater prosperity. In 1990, the Bank founded the SCSB Cultural & Educational Foundation, which administers programs geared toward socio-civic activities and charity events. These efforts have won much praise from the public.
In 1991, the Bank moved its head office to a splendidly remolded building located at the corner of Min-Chuan E. Road and Chung-Shan N. Road, which fully expressed the Bank’s image of stability and innovation. At the same year, the “Business Weekly,” a renowned domestic magazine, conducted a survey on the service qualities of 14 domestic banks. The Bank was rated number one on the list. Also, in 1991, the chairman, Mr. Ju-Tang Chu retired. Mr. Hung-Ching Yung was elected the new chairman. Under the leadership of Mr. Yung, the Bank started another milestone. For the past two decades, the Bank aggressively established branches, upgraded computer facilities, and provided the public with quality and efficient financial services.
The Bank posted remarkable growth records and increased its volume of operation substantially, thus earning for itself a prestigious reputation both here and abroad. The Banker, a famous British periodical, ranked the Bank as the world’s 800th largest bank in 1990, and this ranking climbed to 281st in 2003. Not only is the Bank’s global ranking ascending, but it has also received several international commendations. “Euromoney,” a prestigious worldwide financial journal, gave the Bank its top rating “ααα” among 450 banks in 40 emerging markets in its September 1997 issue. Once again, in the following year, it awarded the Bank another great honor as “the Best Bank in Taiwan”.
As of the end of 2003, with a network of 59 branches, 54 ATM centers, and about 1,900 employees, the Bank has become a strong financial force in the local industry. To cope with greater financial liberalization and globalization, the Bank will continue to adopt new strategies, reinforce risk management, and conduct staff trainings. Moreover, the Bank will take a chance to establish branches located in Chinese Mainland. By improving its financial services, the Bank hopes to become one of the best Chinese Banks across the Taiwan Straits.
[edit] Business Development ( 1915 ~ 1926 )
Due to the honest management and continuous innovations, the Shanghai Commercial and Savings Bank became an important commercial bank in twelve years. Some important innovations from the bank during that period were:
- Started one-dollar saving account
- Initiated silver dollars and taels coexistence
- Advocated credit with objectives
- Originated railroad fright documentary
- Developed international exchange
- Established China Travel Agency
- Emphasized career training
[edit] Great Development ( 1927 ~ WWII )
Since 1927, SCSB has established many branches. In 1934, the Shanghai Commercial and Savings Bank expanded aggressively and had 111 branches in its heyday. At the same time, deposits increased a lot and the Shanghai Commercial and Savings Bank became one of the largest private banks in China. Important innovations during that period were:
- Pioneered into "Unit System"
- Advocated agricultural loans
- Started salt industry loans
- Started small loans secured by credit
- Extended industrial and commercial loans
- Extended trust business
- Developed insurance services
[edit] Contributions during the Second World War
During World War II, the Shanghai Commercial and Savings Bank was devoted to consolidating the economy. In order to solve the financial problems, the founder, Mr. K. P. Chen represented the government and negotiated with U.S.A. about loans. Some agreements were made:
- 1936 -- Siliver Agreement
- 1939 -- Tung Oil Loan Agreement
- 1940 -- Tien Tin Loan Agreement
Mr. K. P. Chen made outstanding contributions in stabilizing the monetary system and raising funds for war of resistance.
[edit] Business Resumed in Taiwan ( 1965 ~ 1982 )
In 1965, the Shanghai Commercial and Savings Bank was the only private bank allowed to reopen in Taiwan, with a capital of NT$15 million.
[edit] Speedy Development ( 1983 till now )
From 1983, under the leadership of Mr. Hung-Ching Yung, SCSB started another milestone. From then on, the Shanghai Commercial and Savings Bank aggressively established branches, upgraded computer facilities, and provided the public with quality and efficient financial services.
In recent years, the Shanghai Commercial and Savings Bank's capital stock has increased and operation scope has also widened dramatically. The Shanghai Commercial and Savings Bank has become a strong financial force in the local industry.
[edit] Corporate social responsibility
To fulfill the social responsibilities, the Shanghai Commercial and Savings Bank also founded the Shanghai Commercial and Savings Bank Cultural & Educational Foundation in 1990, which carries out programs geared toward socio-civic activities and charity events. All these efforts have won much praise from the public.
[edit] Notes/Sources:
- The Making of Modern Chinese Financial Entrepreneurship: The Case of Chen Guangfu by Pui-tak Lee, University of Hong Kong
- Personal papers of Chen Guangfu / K. P. Chen deposited in the Rare Book and Manuscript Library, Columbia University,
- Recently published materials about Chen Guangfu / K. P. Chen from mainland China's archives
- The Shanghai Commercial & Savings Bank, Ltd
