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Bank Regulations. Under such a system, or want of system, much inconvenience was felt by the Government in the way of the administrative control of bank-like companies, which would appear one day and disappear the next. To remedy this state of things, the Financial Department issued a notification saying that permission would henceforth be given for the establishment of banks according to the following regulations:

1. Liability of shareholders should be unlimited. But since 1886 limited liability on security was permitted to a company having the capital of 500,000 yen or upward, if there exist special circumstances recognised by local authorities.
2. Shares should be above 10,000 yen.
3. Payments upon shares should be made within 1 yen.
4. Since 1884 the Government has not permitted the establishment of those private banks whose liabilities could not be clearly known, on the ground that, if savings deposits were received by them, there would not be any means of exercising supervisory control over them. Also ordinary banks may not receive savings deposits.
5. No banks should be permitted to engage in the sale or purchase of shares and other articles.

Under the Commercial Law, the Bank Regulations, and the Savings Bank Regulations, all of which came into force in July, 1893, those institutions which engage in the discount of bills, and receive deposits and make loans, are treated as banks, and those receiving deposits from the general public by means of compound interest, as savings banks, whatever titles they may bear. Those wishing to engage in business of this kind must apply to the Minister of Finance for permission through the local authorities.

All savings banks are joint stock companies, each with a capital of 30,000 yen or upwards. Its directors are liable to the obligations incurred by the bank during their term of office, until the liabilities are extinguished at the expiration of two full years after their resignation.

Much improvement has been effected in the business condition of private banks since the operation of the Commercial Law, the Bank Regulations, and the Savings Bank Regulations. At the end of December, 1893, they had 541 head offices with 160 branches throughout the country, their aggregate amount of capital standing at 35,414,860 yen. A great increase has since taken place in their number, especially after the Japan-China War. At the end of 1901 there existed 2,402 head offices, the total amount of capital standing at 523,188,149 yen.