I am Emperor Wanli

Chapter 767: Can Ming Dynasty’s banks finance the selection of an emperor?

"The first bank in the Ming Dynasty was Wells Fargo Bank, which was established by the Coordination Office. It was first responsible for the deposit and exchange of gold and silver, accepting deposits, and handling bills of exchange and other bills. Soon it also provided loan services.

Later, Huijin, Tongshang and Huimin banks were established, with similar business contents, but different main business areas. Later, Tongshang Bank was renamed Industrial and Commercial Bank of China, Huimin Bank was renamed Minfu Bank, and at the same time, Bank of Communications was established to build straight roads and railways, and Construction Bank was established to develop the northwest and build water conservancy projects.

They are collectively known as the Six Great Vajras."

Comman talked eloquently, and Marcelo and Leon listened very carefully.

Jose listened for a while, suddenly opened his mouth and wanted to yawn, but felt it was inappropriate, so he quickly covered his mouth and pretended to touch his mouth and chin a few times.

But the other three were speaking seriously and listening even more seriously, and didn't notice him at all.

"In the first year of the Wanli reign, the banking system was restructured. Wells Fargo Bank was controlled by the Ministry of Finance, Huijin Bank was controlled by the Ministry of Revenue, and the major shareholders of Industrial and Commercial Bank, Minfu Bank, Communications Bank, and Construction Bank became the Taifu Temple, becoming the six major national banks.

Since then, banks dominated by private capital and operating in different regions such as Shanghai Bank, Bohai Bank, Zhejiang Bank, Donghai Bank, Changjiang Bank, Bashu Bank, Nanhai Bank, Kunlun Bank, Northeast Industrial Bank, and Northwest Tongfu Bank have sprung up like mushrooms after a rain and are called private banks.

However, these state-owned banks and private banks are all supervised by the Financial Bureau of the Shaofu, and the laws they are based on are the "Regulations on the Establishment of Financial Institutions in the First Year of the Wanli Period of the Ming Dynasty" drafted by the Law Courts and promulgated by the Emperor's imperial decree in the first year of the Wanli period, as well as the "Law on the Operation and Management of Financial Institutions in the Third Year of the Wanli Period of the Ming Dynasty" promulgated by the imperial decree in the third year of the Wanli period.

According to the "Regulations on the Establishment of Banks", banks are divided into central banks, namely Wells Fargo Bank and Huijin Bank. Their responsibilities are to implement the monetary policy formulated by the central government, conduct macro-control of the national economy of the Ming Dynasty, and at the same time assume the function of issuing and supervising legal tender.

Policy banks include Industrial and Commercial Bank of China, Bank of China, Bank of Communications and China Construction Bank. In addition to their normal banking duties, they are specifically responsible for implementing and cooperating with the economic policies or intentions formulated by the central government. They directly or indirectly engage in policy financing activities within specific business areas and serve as financial institutions that develop the economy, promote social progress and conduct macroeconomic management.

Commercial banks are ordinary banks that accept public deposits, issue loans, and handle bill discounts. Their main businesses include deposits, loans, foreign exchange, savings, etc., as well as credit intermediation.

Marcelo and Leon felt a little dizzy after hearing what Komuman said on the phone. They forced themselves to remember the words in their hearts and digest them slowly later.

Marcelo thought of a question: "You just said that there are state-owned banks, private banks, central, policy and commercial banks in China. What is the difference between these?"

“Completely different bank.

State-owned banks refer to banks that are fully controlled by the government and hold the majority of shares. Currently, they refer to the six major banks that were established first. Private banks refer to banks that are independently controlled by private capital and hold the majority of shares. Currently, ordinary banks other than the six major banks are private banks.

State-owned banks are all central banks and policy banks, with some commercial banks. Private banks are all commercial banks.

Leon asked, "Manuel, you just said that the central bank is also responsible for issuing and supervising legal tender. Are all Ming silver dollars issued by Wells Fargo and Huijin Bank?"

"Yes. The current Ming Dynasty currency includes three types: silver yuan, jiao, and copper fen. The issuance and supervision mechanism is confidential, and I don't know how it works in detail.

As far as I know, the amount of money issued each year, the deposit reserve ratio, and the formulation of monetary policies such as the central bank's deposit and loan interest rates are decided by the Monetary Guidance Council under the Financial Bureau of the Shaofujian, which discusses and votes, and the minority is subject to the majority.

The Monetary Guidance Council has a total of ten votes, with the two central banks accounting for two votes each, the four policy banks accounting for one vote each, and all commercial banks together accounting for the remaining two votes.

The monetary policy discussed and voted by the Monetary Steering Committee will be implemented by Wells Fargo and Huijin Bank, and other banks will follow suit.

Marcelo and Leon looked at each other.

It’s so complicated!

But if you think about it more deeply, currency, money! How important is it? Of course, we must be extremely cautious.

That's not right. Such an important matter is handed over to the so-called Monetary Guidance Council for discussion and decision. Doesn't the all-powerful Shaofujian care about it?

Doesn’t the cabinet headed by civil servants care?

The emperor doesn’t care?
impossible!

Think about it again, Wells Fargo Bank is under the supervision of the Shaofu, Huijin Bank is under the supervision of the Ministry of Revenue, and the other four policy banks are under the supervision of the Taifu Temple. These six banks account for eight votes.

Eight out of ten votes!

Whatever the idea and intention, these eight votes can make it a decision of the Monetary Policy Council.

The emperor and cabinet of the Ming Dynasty really know how to play!
Leon knew Komoman's ambition and couldn't help asking, "Manuel, what are the requirements for opening a bank in Ming?"

"At least 1 million yen of capital is required, of which 500,000 yen is kept as reserves in Wells Fargo or Huijin Bank. If the scale is expanded, 20% of the reserves must be kept in the central bank.

It has a fixed office space and safe, and can open more than one business office; the safety conditions of the safe and business office must meet the requirements listed in the Ministry of Justice's "Catalogue of Safety and Fire Conditions for Financial Business Premises".

Deposit and loan interest rates strictly follow the current interest rates of the Monetary Guidance Council and other financial and monetary guidance policies, operate in compliance with the law, accept supervision from the Financial Bureau at any time, and provide true and detailed reports to the Financial Bureau every quarter for audit.
The bank's legal person and more than 60% of its shareholders must be citizens of the Ming Dynasty
But the most important point is that after meeting the above conditions, you must apply to the Financial Bureau of the Shaofujian, and after review and approval, you will be issued a commercial bank license. You must then file with the Ministry of Revenue, the Ministry of Justice, and the Taifu Temple before you can officially open a bank and start business.

A bank license is the hardest to get, even harder than a cigarette factory license."

Jose's heart moved. No wonder Komuman tried every means to get in touch with Eunuch Yang, the Supervisor of the Imperial Household.

Marcelo couldn't help but frown. He knew something about the power of the bank.

For example, the Fugger family, which had close ties with the Habsburg royal family, started out in the textile industry, then controlled the mining and precious metal resources in Germany, Austria, Bohemia and Spain, and established banks, providing great help to the Habsburg royal family.

It was with the financial support of the Fugger Bank that the former King of Spain, Carlos I (Charles V), bribed the Electors in 1519, defeated the King of France, Francis I, and was elected King of Germany. He then marched to Rome, was crowned by the Pope, and became the Holy Roman Emperor.

The power of bank money is evident from this.

Will the banks in Ming Dynasty also have such power?

"Manuel, what is the difference between banks in Ming Dynasty and banks in Europe?"

After hearing Marcelo's question, Komuman shook his head: "My Lord Marquis, the difference is very big.

The earliest banks in Europe were the National Lending House of Venice, which engaged in simple deposit and loan business and made profits from the difference between deposit and loan interest rates.

After that, various banks emerged, such as the Bardi Bank in Florence and the Fugger Company in Augsburg. However, these banks were financial institutions established by wealthy families to facilitate business, and they were far behind the banks in the Ming Dynasty.

First of all, the operating methods are different. Most European banks accept deposits from citizens and small and medium-sized businessmen, which are used for family business or even political investment.

Relying on the family's business reputation, without any guarantee or supervision, the risk is extremely high. The business methods are simple and crude.
The banks of the Ming Dynasty only received deposits from ordinary people, and the majority of deposits came from industry, commerce and wealthy families. The purpose was to serve industry and commerce, facilitate the people and promote the economy.

The Ming Bank has strict supervision, flexible operating methods and complete rules and regulations.

Its loans are mainly used for industrial and commercial development and are strictly prohibited from being used for political speculation, which is a red line in the banking industry. "

After hearing Comman's answer, Marcelo frowned even more.

"Does Ming's banks have no influence on politics at all?"

"My Lord Marquis, I know what you mean. Anyone who has money, especially those who are extremely wealthy, not only wants to control more resources, but also desires to control the power of the country in order to protect their wealth.

For example, we know the Venetian merchants, the Dutch merchants and the Fugger family.

They did so by manipulating the elections of the Pope and the Holy Roman Empire with money, secretly sponsoring the rise of Protestantism, and indirectly influencing the politics of France, Spain and other countries through loans and public debts.

Even without their support, Paris, Madrid, and the kings and electors of Bavaria could not wage the war they wanted.

But the Ming Dynasty is different from Europe. Europe has been fragmented for most of its thousands of years of history, with dozens of countries. Bankers can move easily between these countries. If the east is not bright, the west will be bright.

The kings and nobles of these countries were unable to control these bankers and could only compromise and accept their threats.

Power becomes subordinate to money.

The Ming Dynasty had a history of thousands of years, and most of it was unified. The same court, the same emperor, the same writing system, the same voice. Money was an appendage of power.

Therefore, in the Ming Dynasty, it was extremely dangerous for merchants to try to manipulate the court through banks, just like walking up to a tiger and pulling its beard hard.

"So what other rewards can these businessmen who run banks get besides money? In other words, how can they ensure that their wealth will not be arbitrarily taken away?"

“In addition to the lucrative profits, business owners in the Ming Dynasty, including those who run factories, businesses, and banks, will be granted corresponding civil service ranks as long as they can pay enough taxes.

Well, it is similar to a noble title. There is no fiefdom or salary, but the political treatment of civil officials of the same rank can be enjoyed. For example, they are allowed to wear the official uniform corresponding to their rank and display their rank flag when traveling; supervise the administration of the court and local governments; make suggestions on the regulations and laws promulgated by the cabinet and the censorate; and submit memorials directly to the Tongzhengsi.

"Submit a memorial to the Ministry of Public Security?"

"Yes, the Tongzhengsi and Silijian are secretarial agencies of the outer and inner courts established by His Majesty the Emperor to pass on information from top to bottom.

If you submit a petition to the Tongzhengsi, even if the emperor does not see it, the Tongzhengsi will, as the emperor's secretariat, hand it over to the relevant departments and urge them to give a formal reply."

"Manuel, as you said, the most important function of the Bank of Ming is to promote the economy?"

"Yes. This is the duty that His Majesty the Emperor has set for the Bank of Ming. Currency circulation, revitalization of industry and commerce, and promotion of economy. Commercial banks provide normal industrial and commercial loan support; provide financial bill services to reduce the cost of industrial and commercial transactions; provide government bonds, corporate bonds and stock issuance, and provide financing services for national and local construction and enterprise development."

Marcelo felt like Alibaba who had finally opened a door full of treasures after reciting the right spell. He couldn't wait to ask, "Manuel, what do you mean by providing financing services?"

Comman and Jose looked at each other, and they now figured out the real purpose of Marcelo's mission to the Ming Dynasty.

Leon or other nobles are enough to do this kind of work, so why send out Marcelo, the most trusted minister of His Majesty the King?

Understand the Ming Dynasty, learn from the Ming Dynasty, and copy the Ming Dynasty.

But my lord the Marquis, the Ming Dynasty may be able to do it, but Portugal may not be able to do it!
But seeing Marcelo's eager eyes, Komuman hesitated and said, "Mr. Marquis, the banks of the Ming Dynasty cannot finance the election of emperors and ministers, but they can finance the Ming army and destroy a country, such as Spain."

Marcelo's eyes flashed and he became more anxious. "Manuel, please tell me how they did it!"

(End of this chapter)