The Mitsubishi Trust & Banking Corporation
The Mitsubishi Trust & Banking Corporation
4-5, Marunouchi 1-chome
Chiyoda-ku
Tokyo 100
Japan
(03)212-1211
Public Company
Incorporated: 1927
Employees: 6,300
Assets: ¥17.2 trillion (US$137.62 billion)
Stock Index: Tokyo Osaka London
Mitsubishi Trust and Banking Corporation is the leading trust bank in Japan. The Mitsubishi group, originally a shipping and warehousing conglomerate, created a bank in 1919. The Mitsubishi Bank, however, was prevented by banking legislation from conducting trust operations, an increasingly popular and profitable business. In 1927 various members of the Mitsubishi conglomerate, or zaibatsu, led by the Mitsubishi Bank, capitalized and incorporated the Mitsubishi Trust & Banking Corporation. Although it was an entirely separate company, Mitsubishi Trust was controlled by other Mitsubishi companies through cross-ownership of stock and board representation.
Mitsubishi Trust spent much of its early existence busily building market share. The company met intense competition from trust operations run by rival zaibatsu groups, mainly Yasuda and Mitsui. In 1929 the company opened a branch office in Osaka, Japan’s second city and also the headquarters of Sumitomo, another major zaibatsu that operated a trust bank.
Political battles within the Japanese government during much of the 1930s slowed the growth of the zaibatsu groups somewhat. A group of militarists who opposed the tremendous economic power of the zaibatsu came to power. Many of the Mitsubishi companies tried to be inconspicuous, turning their attention to internal consolidation, while the head of the group worked to maintain good relations with the new government.
Mitsubishi Trust opened its third branch, in Nagoya, in 1940, and additional branches in Fukuoka and Yokohama in 1941. Under the quasi-wartime economy, such expansions were officially considered good for economic efficiency. The new branches enabled Mitsubishi Trust to exploit opportunities in a wider area and to establish a more effective financial network.
Mitsubishi Trust served as a capital resource for the Mitsubishi group, which had become intimately involved with government as a military and public projects contractor. In 1942, with the war well under way, Mitsubishi Trust opened two additional branches, in Kyoto and Kobe.
After the war, however, Japan’s economy was in ruins and the occupation authority enacted emergency measures to rescue Japan’s financial industries. Mitsubishi Trust was effectively closed. While new financial legislation was drafted, the Trust was reorganized into a smaller company, now called Asahi Trust & Banking, and all its connections with other Mitsubishi companies were eliminated, in accordance with the new anti-monopoly law.
The company reopened in 1948, and was authorized to deal in foreign exchange the following year. In an effort to promote reconstruction and diversify its operations, Asahi Trust took over some stock investment trust business from the Yamaichi and Nikko securities houses.
Japanese industrial laws were liberalized in 1952, allowing former zaibatsu affiliates to re-establish limited cross-investment and resume use of their prewar names. Asahi Trust changed its name back to Mitsubushi Trust & Banking. In 1958 it opened a stock transfer agency.
During the 1960s Mitsubishi Trust once again became an integral capital resource for the companies of the Mitsubishi group. Mitsubishi Heavy Industries and the Mitsubishi Corporation, a general trading company, built up large minority stakes in the Trust. Like the other Mitsubishi companies, they provided the Trust with a steady stream of business.
While the Mitsubishi group never regained the power it held before the war, Mitsubishi Trust had become more important to the organization than ever before. As it entered the 1970s, it became increasingly involved in a financial combine within the group. This miniature conglomerate, consisting of the Trust, Mitsubishi Bank, Tokio Fire & Marine Insurance, and Meiji Mutual Life Insurance, acted as a major multi-service financial institution. As interlocking but separate companies, they were able to circumvent financial regulations preventing them from engaging in each others’ lines of business.
Mitsubishi Trust maintained a somewhat different outlook from its group partners. While the manufacturing and trading companies of the Mitsubishi group were outward-looking and eager to develop foreign markets, Mitsubishi Trust concentrated on domestic business. It differed markedly from the Mitsubishi Bank, which had long ago established overseas offices to support the group’s business in foreign markets. As the group companies continued to expand, they created greater demand for trust business and other banking services, which the Trust gladly provided.
During the 1980s lobbying efforts from every sector of Japanese finance sought to strike down the restrictive regulations which kept banks and other institutions specialized and numerous. When by the mid-1980s it was clear that deregulation would come, Mitsubishi Trust finally adopted a more aggressive attitude.
The company devised contingency plans to develop a wider base of marketable services. The Trust, however, was in no grave danger of losing out, as it was already closely associated with friendly insurance companies, banks, and brokerages in the Mitsubishi group. Still, eager to exploit new opportunities in the United States, Mitsubishi Trust opened a branch office in New York in 1988.
Mitsubishi Trust & Banking is the leading trust bank in Japan. It enjoys excellent coverage in greater Tokyo, and continues to benefit from its association with the Mitsubishi group. Slow at first to respond to the liberalization of Japanese financial laws, it is now a most aggressive innovator. Its emphasis is on longer-term relationships and premium services. The company’s growth has been impressive, and it shows no signs of slowing.
Principal Subsidiaries:
Mitsubishi Trust & Banking Corporation (Europe) S.A. (Belgium); Mitsubishi Trust & Banking Corp. (U.S.A.); Mitsubishi Trust Australia Ltd.; Mitsubishi Trust International Ltd. (U.K.); Mitsubishi Trust Finance (Switzerland) Ltd.; Mitsubishi Trust Finance (Asia) Ltd.; MTBC Finance Inc. (U.S.A.).