The purpose of this paper is to reveal that during the 1910’s, the Bank of Joseon maintained its identity as an overseas bank rather than a central bank of colonized Joseon, and its prototype was formed during its advance into Manchuria. In 1912, the Bank of Joseon urged Japanese governmen’s approval to expand their business to Manchuria, because it suffered a structural limitation driven by the bank’s weakened capacity to issue notes amid due the outflow of specie. The bank sought to replenish the supply of specie by making an advance into Manchuria, an area which Japan had a trade surplus in trade, and thereby the bank could expect reinforce its note-issuing power.
However, the Bank of Joseon’s desire to penetrate into Manchuria could be possible only as a national financial institution funded by Japanese Empire, which required coordination with other financial institutions or political factions. The Bank of Joseon pushed ahead with its plan, stressing that it was the only financial institution that could achieve the national policy of the continental invasion under the principle of ‘the Unity in Chosun and Manchuria’ of the Japanese military. In the end, the bank was able to become a central financial institution in Manchuria with the approval of Prime Minister Terauchi Masatake, who had served as the Governor General of Joseon, and Finance Minister Shoda Kazue, who had served as the president of the Bank of Joseon. This shows that the bank’s foray into Manchuria in the 1910’s not only was made as a part of the Japanese colonialists’ policy, but collaborated with the strong will of the bank’s insiders.
Thus, the Bank of Joseon founded and strengthened its identity as an overseas bank in the process of justifying the expansion to Manchuria. The monopolistic power of note issuance was a privilege granted to the Bank of Joseon to carry out national policies. As a commercial bank, the privilege was also a source of profits for the bank. It could generate profits by carrying out Japanese policies as a national institution such as a continental invasion of Japanese force. The bank could not have played such a role if it intended to limit their position as a mere central bank of Joseon. As a result, the bank came to identify itself as an overseas bank rather than a central bank of the colonized Joseon.