The Satsuma Zaibatsu

Thomas Schalow
University of Marketing and Distribution Sciences, Kobe, Japan
ijinkan@mac.com


I. Introduction

Zaibatsu is the term applied to a particular type of
Japanese business enterprise, the characteristics of of
which are not always uniform and often vaguely dened,
that existed during the period from about the beginning of
the twentieth century to the end of the Pacic War. The
zaibatsu generally concentrated capital, production,
distribution, and other operations in a centrally-controlled
and often family-owned business enterprise, but there
were signicant variations among companies even in
basic organization and business operations. The post-war
keiretsu, which are generally seen as direct descendants
of the zaibatsu, do not necessarily combine all of these
functions under the umbrella of a single company name,
but are in some way held together by the same types of
relationships that characterized the prewar zaibatsu.

In this paper I wish to examine one of the lesser-known
zaibatsu, referred to by contemporary sources as the
Sasshu zaibatsu, or the Satsuma zaibatsu. The term
Sasshu zaibatsu derives from the fact that the controlling
members of the group shared a common birthplace, or
otherwise identied with, the pre-modern Satsuma clan,
which was located in the area of present-day Kagoshima
prefecture. More specically, however, the group might
also have been referred to as the Matsukata zaibatsu, as
the companies which were generally recognized to be a
part of the group were all under the actual or de-facto
control of a member of the Matsukata family.

An interesting, and perhaps unique, feature of the
Satsuma zaibatsu was that control of the business group
was not initially in Matsukata hands. In fact, one author
has referred to more or less the same group of business
as the Kawasaki zaibatsu, due to the fact that the most
important business operations were originally in the hands
of the Kawasaki family. It was only gradually, over time,
that control was wrested from the Kawasaki family, and
came to reside with the Matsukata brothers.

The close relationship between the two families, and their
interlocking interests, was a characteristic of the Satsuma
zaibatsu since its very inception. It was, in fact, the father
of the Matsukata brothers, Matsukata Masayoshi, who
endowed the Kawasaki family with the resources from
which the enterprise group was created. Soon after the
Meiji Restoration Matsukata Masayoshi, employed in a
low-level position within the Finance Ministry, was able to
divert government funds, as loans, to the pocket of
businessman Kawasaki Shuzo, the founder of Kawasaki
Shipbuilding. Kawasaki, a native of Satsuma, was at the
time engaged in trading with the Ryukyu islands, and had
approached Matsukata with a request for funds to expand
his operations. matsukata supplied the loans (they were
never repaid) to an assistant of Kawasakis, and the
tangled relationship between the two families thus began.
The subterfuge of calling the subsidy a loan was designed
to blunt potential charges of favoritism to a fellow Satsuma
native, but in fact the very basis of the Satsuma zaibatsu
was its clan-based system of loyalty.

Over the course of four years and on sixteen separate
occasions the Finance Ministry made a total of 9,042 yen
in cash, a substantial amount for the time, available to
Kawasakis venture. Kawasakis subsequent selection of
Matsukata Masayoshis son Kojiro as the rst president of
Kawasaki Shipbuilding seems quite understandable given
Kojiros qualications, as we shall soon see, and Shozos
past debts.

Oddly enough, the relationship between the Matsukata
and Kawasaki families was further cemented by the
selection of a collateral member of the Kawasaki family,
Kawasaki Yoshitaro, as heir to Shozo. Although Shozo
himself fathered three sons, two died quite suddenly of
illness in 1885 and the third, born the following year, later
decided that he did not wish to pursue a career in
business. Kawasaki desperately needed an heir to
continue his business, but unable to nd one among his
own sons was forced to adopt his nephew, Yoshitaro.
Yoshitaro was neither particularly healthy nor business-
wise, however, and after Shozos death in 1912 he was
generally recognized to be nothing more than a
gurehead. The real power behind the companies he
supposedly headed invariably lay with a Matsukata. As a
consequence, control over the Kawasaki empire gradually
slipped from Yoshitaros hands into the stronger grasp of
the Matsukata family. In this article I wish to examine how
that transfer of control was effected, and more generally
look at the business empire that the Matsukata-Kawasaki
family was able to create. I will begin with a discussion of
the Matsukata family, which became heir to the Satsuma
zaibatsu.

II. The Matsukata Family

Matsukata Masayoshi was father to twelve sons, seven of
whom became prominent businessmen involved in the
creation of the Satsuma zaibatsu. In many respect it was
the eldest of these sons, Matsukata Iwao (1862-1942),
who was most responsible for continuing the nancial
support for Kawasaki interests initially provided by the
father that eventually made Matsukata control of the
zaibatsu possible. Iwao was able to provide this support
not on the basis of direct government funds for Kawasaki,
as his father had been capable of from his position in the
Ministry of Finance, but rather from old wealth and his
position as president of what had once been the most
highly capitalized private bank in Japan - the 15th Bank. It
was during Iwaos tenure of ofce (January 1915 -
November 1922) that the funds of the 15th Bank were
placed at the disposal of his younger brothers through
loans to the companies they controlled, and in effect
became the lead bank for the Satsuma zaibatsu. By the
time the bank failed in 1927 (an interesting story in its own
right, which I can not, unfortunately, discus in this article)
over one hundred and forty million yen of loans, a full one-
third of the banks total assets, had been granted to the
network of companies under Matsukata control. We shall
discuss these loans, and the nancial links between the
Satsuma zaibatsu and its lead bank, when we look more
closely at the nancial component of the Matsukata
empire later in this article.

Iwao joined the management of the 15th Bank in July
1898 after returning from nearly a decade of study and
experiences abroad. He was initially made a junior
member of the board of directors, and demonstrations of
competence soon earned him the additional post of vice-
president November 1901. Fourteen years later he was
ready to assume the presidency of the bank, following the
retirement of Sonoda Kokichi. In addition to this position of
power, Iwao also served as the president of the Taisho
Bank, I mperi al Warehouse and Transport , and
International Trust, all institutions afliated with the 15th
Bank, and considered members of the Satsuma zaibatsu.

The third son of Matsukata Masayoshi, and perhaps the
most important for our discussion, was Matsukata Kojiro
(1865-1949), who served as the president of Kawasaki
Shipbuilding during the transfer of power from Kawasaki
family to the Matsukata family. Kojiro, incidentally, was
also president of Kobe Gas, Kyushu Electric Railway,
Kyushu Real Estate, Asahi Oil, Kawasaki Steamship, and
International Steamship, all members of the Satsuma
zaibatsu group of companies. He also served as the
managing director of the Matsu Trading Company, which
was a general holding company for his business interests.

Prior to entering the business world, Kojiro had gained
entrance to the prestigious Tokyo Imperial University, after
completion of an elite secondary education. He soon
found, however, that his aspirations stretched far beyond
the shores of the tiny Japanese archipelago. Midway
through his studies, therefore, he decided to leave the
university and traveled to Europe and America to study at
the Sorbonne, Rutgers, and Yale. After returning to Japan
in 1890 he worked as his fathers private secretary,
gaining considerable experience and building a large
network of important contacts, until the rst Matsukata
cabinet collapsed in the summer of 1892. After a short
employment in the Imperial Household Ministry he
accepted, in 1894, his rst major business position as
vice-president of the Naniwa Fire Insurance Company.
Two years later he was invited by Kawasaki Shozo,
founder and general manager of Kawasaki Shipbuilding, to
become that companys rst president. The next thirty
years of Kojiros life were spent at Kawasaki, until he was
forced to retire as president in 1929.

The third of the seven brothers we will be discussing was
Matsukata Masao (1868-1942), the fourth son of
Matsukata Masayoshi. Masao is go great importance to
our discussion because he was, as president of the
Naniwa Bank (with which the 15th Bank would later
merge), the rst to approve the loans upon which
Kawasaki Shipbuilding and the Satsuma zaibatsu came to
rely. He was also a member of the board of directors of the
15th Bank, International Trust, and International
Steamship, was an auditor at Kawasaki, and president of
two insurance companies - Fukutoku Life and Daifuku
Marine and Fire Insurance.

Matsukatas fth son, Goro (1871-1956), was, next to
Kojiro, the most active member of the Satsuma group. He
graduated from the Tokyo Imperial University School of
Law in 1896 and then followed his brothers Iwao and
Kojiro to England and Germany to gain practical
experience abroad. After returning to Japan Kojiro gave
him a position at Kawasaki Shipbuilding. He perhaps grew
weary of working under his brother and so in 1909 began
working at Tokai Life Insurance, becoming that companys
president in 1916. From 1910 he also served as president
of the Tokyo Gas and Electric Manufacturing Company
and two years later established the rst of two holding
companies, the Joban Trading Company, that was to
gure so prominently in the Matsukata empire. Needless
to say, the money for the creation and expansion of these
ventures was supplied by the 15th Bank and, somewhat
later, by its subsidiary, the International Trust Company.

We end our discussion of the Matsukata family with
reference to the seventh and eighth sons of Matsukata
Masayoshi, Otohiko and Shokuma. The latter, Matsukata
Shokuma (1881-1969), was the rst of Matsukatas sons
who did not share the same mother with his elder
brothers. He was the child of the rst of three concubines
that Matsukata kept in his later years. Nonetheless,
Shokuma was treated as a full member of the Matsukata
business fraternity and contributed the skills he learned at
Tokyo Imperial Universitys agricultural college to the
advancement of those interests. In 1910 he joined the
Imperial Sugar Company as a member of its board of
directors and seven years later ascended to the
presidency of the company.

Matsukata Otohiko (1880-1952) was of minor importance
in the actual business affairs of the empire his brothers
were building but was, nonetheless, a very useful member
of the Satsuma group. After graduating from Harvard
University he returned to Japan to serve on the board of
directors of Tokyo Gas and Electric Manufacturing, osaka
shamitsu Manufacturing, and Japan Oil. He was not
particularly active in the business world, however, and is
best remembered for his marriage to the daughter of
Naval Minister Yamamoto Gonnohyoe, also of Satsuma
origins. Satsuma connections with the Naval Ministry had
traditionally been strong and proved to be of great use to
Kawasaki during its darkest days, when the company
faced bankruptcy.

III. The Struggle Between the Matsukata and Kawasaki
Families for Control of the Satsuma Zaibatsu

When Kawasaki Shozo i ncorporat ed Kawasaki
Shipbuilding in 1896 he reserved over seventy-one
percent of the companys stock for his own family. He
himself held half of the forty thousand shares, 4,700
shares belonged to the husband of Shozos younger
sister, his eldest daughters son held three thousand
shares, and Yoshitaro was given one thousand shares.
Matsukata Kojiro, president of the company, was also
allotted one thousand shares. However, the Matsukata
family gradually gained greater control of the companys
stock through loans provided by elder brother Iwao from
his position as president of the 15th Bank. The following
chart shows how Matsukata inuence grew over time
while Kawasaki family control was diluted.

Year Total Shares Held by Matsukata Family Held by Kawasaki Family
1896 40,0000 1,000 2.5% 28,700 71.7%
1913 200,000 9,363 4.6% 70,514 35.4 %
1916 200,000 17,126 8.5% 66,754 33.3%
1920 900,000 105,767 11.8% 125,876 14.0%
1921 900,000 161,467 17.9% 66,916 7.4%
1926 1,800,000 323,934 18.0% 129,932 7.2%


As the above chart shows, by 1921, when the existence of
a Satsuma zaibatsu was generally recognized, majority
stock control of the primary manufacturing arm of the
group, Kawasaki Shipbuilding, had passed from the
Kawasaki family to the Matsukata family.

As noted earlier, nancial control of Kawasaki Shipbuilding
by the Matsukata family became possible as a result of
funds provided by the 15th Bank. The 15th Bank was thus
more than a lead bank for the Satsuma zaibatsu; it was
also a jewel to be coveted, as control over its funds made
control of the zaibatsu possible. Matsukata interests were
most strongly entrenched at the bank, and thus came to
dominate the Satsuma zaibatsu.

This did not, however, prevent the Kawasaki family from
making an attempt to seize control of the jewel. Kawasaki
Yoshitaro was not only a gurehead behind which the
Matsukata family could operate, but was also a link to the
15th Bank itself. Yoshitaros eldest daughter was married
to the eldest son of Naruse Masayasu, who succeeded
Matsukata Iwao as president of the 15th Bank in 1922.
Naruse was also, of course, from Satsuma and had
previously served as the president of the Teiyu Bank,
which merged with the 15th Bank in 1919. The 15th Bank
came to be, therefore, in some respects a battleground
upon which the struggle for control of the Satsuma
zaibatsu was played out.

This is not to say, however, that the competition between
the Kawasaki and Matsukata families was erce, or that
there was no cooperation between the two. In fact, the
families owed a strong allegiance to their Satsuma origins,
which is why the group was more widely known as the
Satsuma, rather than Matsukata, zaibatsu. The Matsukata
family may have been large, but it was limited in the
numbers of people whose services it could provide to the
group, as was equally true of the Kawasaki family. The
group, though, was populated by many people who could
trace their origins, or their loyalty, to the larger Satsuma
family.

In the nal analysis, however, it was the money link with
the 15th Bank that provided the means for control of the
Satsuma zaibatsu, and it was the Matsukata family, rather
than the Kawasaki family, that held a rm control over the
bank itself. The following chart will illustrate the degree to
which the Matsukata family plundered the bank for its own
use, allowing for the control and expansion of the Satsuma
zaibatsu.

Matsukata Loans from the 15th Bank as of May 1927
(millions of yen)




Personal Company Total
Matsukata Iwao .148 .148
______________________________________________________________________
Matsukata Kojiro 2.421
Kawasaki shipbuilding 40.811
Matsu trading company 13.240
International Steamship 10.969
67.441
______________________________________________________________________

Matsukata Masao .883 .883
______________________________________________________________________
Matsukata Goro .544
Joban trading company 32.261
Kuji steel 5.098
Tokyo Gas & Electric Mftg. 21.066
58.969
______________________________________________________________________
Matsukata Otohiko 2.109 2.109
______________________________________________________________________
Matsukata Shokuma .954
Imperial Sugar 11.078
12.032
______________________________________________________________________
Matsukata Yoshisuke .185 .185
______________________________________________________________________
Totals 7.244 134.523 141.767


IV. The Components of the Satsuma Zaibatsu

Zaibatsu, by their very nature, are not easy organizations
to understand. It is often difcult to decide which
companies ought to be considered a part of the zaibatsu
group, and which companies, though related or in some
way controlled by other members of the group,
nonetheless remain peripheral. This applies to the
Satsuma zaibatsu as much as it did the Mitsui, Mitsubishi,
Sumitomo, or Yasuda groups. In this section I will not
undertake to list all member companies of the Satsuma
group. It is my hope that another author will take up the
challenge to identify other members of the Satsuma
zaibatsu. I merely offer a partial listing of some of the most
important or noteworthy companies, beginning with
kawasaki Shipbuilding, the most important manufacturing
company within the group.

A. Kawasaki Shipbuilding

Kawasaki Shipbuilding, which was the parent company to
all of Kojiros remaining interests in the shipping industry,
was established in 1887 by Kawasaki Shozo from the
plant and equipment acquired from the Meiji governments
Hyogo shipbuilding facilities and Kawasakis own Hyogo
operations. It became a joint stock company in 1896 with a
capitalization of two million yen. It expanded rapidly,
probably to rapidly, in the following years and during the
1908-1909 recession it relied upon government orders of
railway car engines and warships to pull it out of difculty.

This act of ofcial largesse may have caused the
company, and Kojiro, to believe that the government would
always be ready to place orders when overcapacity
threatened it or the shipbuilding industry in general, and it
repeated its earlier mistake once again during the First
World War. The government was not so eager to absorb
excess production after the war, however, and was,
indeed, severely limited in its ability to do so after
agreements on naval limitations were reached at the
Washington Conference of 1921-1922.

Kawasakis problems were not all related, however, to
naval limitations agreements or the end of the war. During
the war years its business practices served to alienate it
from the domestic market and lay the foundation for future
difculties. In the early years of the war, for example, it
insisted on building nothing except stock boats, which
were highly protable, mass-produced vessels. These
ships were easily sold ion the early years of the war due to
the shortage of commercial vessels, but were never
popular with buyers. When alternate choices became
available the shipping companies that purchased the
vessels began to place their orders elsewhere. Kawasaki
still refused to accept orders for custom-built ships,
however, and insisted that while shipping companies might
know the shipping business it best knew how to build
those ships. Such arrogance infuriated companies such as
OSK, which made a rm decision to place no more orders
with Kawasaki.

Kawasaki compounded the problem brought about by its
stock boats by choosing to ignore other signicant
developments. There has been a general trend, for
example, for shipping companies to acquire control of the
stock of shipbuilders during the war. Nihon Yusen thus
acquired the stock of Yokohama Dockyards, Osaka
Shosen purchased shares in the Osaka Iron Works, and
Yamashita Steamship bought the stock of Uraga
Dockyards. Following these acquisitions shipping
companies began to place orders with their afliated
shipbuilders. Kawasaki made no effort to court shipping
companies and actually alienated them even further by
deciding to form its own shipping company, Kawasaki
Steamship. By the end of the war Kawasaki found itself
unable to sell its ships to anyone except American
shipping companies, which were obliged to buy from
Japan under provisions of a steel-for-ships agreement.

B. Kawasaki Steamship

Kojiro brought the idea for Kawasaki Steamship back to
Japan after a two year sojourn in Europe at the end of the
war, during which time he was able to observe conditions
in the shipbuilding industries in the worlds most advanced
merchant countries. In Europe Kojiro realized that if his
ships could not be sold, they might nonetheless be
disposed of. This was to be done by establishing a
subsidiary shipping company, Kawasaki Steamship, to
purchase Kawasaki vessels in exchange for stock shares
and future revenue. The sleight of hand possible with
creative accounting was thus adopted as the answer to
Kawasakis problems. No one cared to suggest that the
company might actually need to limit growth or even shrink
somewhat in order to address those problems.

C. Matsu Trading Company

The Matsu Trading Company was established by Kojiro in
october 1920 with a capital of ve million yen. It continued
operations until 1935, though the majority of its holding
were in escrow for much of the period following the 1927
banking crisis. The Matsu Trading Company was, strictly
speaking, more a personal trust fund for Kojiro than an
investment trust for Matsukata interests, and Kojiro used
the funds supplied to the company solely for his own
purposes. The immediate cash needs of the company
were supplied by the Kobe ofce of the 15th Bank (8.069
million yen), the Osaka branch of that bank (4.082 million
yen), the Shinbashi branch (840,000 yen), and the
Nihonbashi branch (249,000 yen).

With this money Kojiro was able to acquire a six percent
share of Kyushu Real Estate, a ten percent shar elf the
Kyushu Electric Railway, a twenty-four percent share of
Kobe Gas, and minor shares in Imperial Sugar and
Fukutou Life Insurance. The Matsu Trading Company was
primarily used, however, as a means for Kojiro to acquire
stock for his own account in kawasaki Shipbuilding. By
1922 Kojiro held 16.5 percent of all Kawasaki stock
through the Matsu Trading Company.

D. Joban Trading Company

Kojiro may actually have been inspired to form the Matsu
Trading Company as a result of his brother Goro success
with the Joban Trading Company. This company was
established in 1912, also with a ve million yen
capitalization. It was originally founded as a representative
ofce for a foreign re insurance company, but with the
upturn in steel prices due to the First World War it became
involved in the import of steel from America and eventually
shifted into production. In order to supply its mills it
purchased a mine in Iwate prefectures Kuji city, borrowing
heavily from the 15th Bank for these new operations. Goro
was not inclined to use normal channels for these loans,
however, and chose to tap the resources of the 15th
Banks subsidiary company, International Trust, for a
majority of the thirty-seven million yen in funds supplied.

E. International Trust Company

The International Trust Company was established on 20
May 1920 by Matsukata Iwao, former 15th Bank president
Sonoda Kokichi, Maruse Masayasu and his younger
brother Masayuki, Matsukata Kojiro, Matsukata Masao,
Matsukata Yoshisuke, and a few othe rpersons of lesser
eminence. It was the largest trust company in Japan at the
time it was created, dwarng even the great Nichi-Bei
Trust controlled by the Suzuki trading house. It was
capitalized at fty million yen, of which 12.5 million was
paid in, and issued one million shares of stock, though
only thirty thousand of those shares were offered for public
subscription. The remaining shares were primarily
controlled by the Matsukata family, through the 15th bank,
or their close group of associates. The goals of its
founders were ambitious but strictly dened. From tis
prestigious Ginza 4-chime location the International Trust
operated almost exclusively as an alternate source of
funds for Matsukata companies.

F. Tokyo Gas & Electric Manufacturing Company

Goros other major business venture was the Tokyo Gas
and Electric Manufacturing Company, which used the steel
the Joban trading company had begun to manufacture
during the war for a variety of purposes. Although the
company, established in 1910, was initially engaged in the
production of sundry items used by the gas and electric
industries, when World War I began it expanded into the
armaments, automobile and airplane parts, and other
heavier manufacturing businesses.

In order to nance this expansion Goro borrowed heavily,
once again, from International Trust. The company used
these funds prudently but the downturn in the economy
after the war severely depressed prots and the 1923
Kanto earthquake heavily damaged a number of the
companys manufacturing facilities. In 1927 this company,
along with so many other companies within the Matsukata
group, found itself deep in debt and with far more
industrial capacity than the economy at the time
demanded.


G. Imperial Sugar

Matsukata Shokumas contribution to the mountain of
debts that the Satsuma zaibatsu had accumulated
resulted from his investments in Imperial Sugar, a small
company engaged in the processing of raw sugar cane
from its base in Taichung in central Taiwan. Among the
Matsukata companies it was the most consistently
protable, even after the downturn in sugar prices at the
end of the First World War. Shokuma was not content to
remain a minor producer of sugar, however, and in 1919 a
sister company, Hokkaido Sugar, was formed.

H. Hokkaido Sugar

Hokkaido Sugar proved to be an unprotable venture from
tis very inception, but Shokuma decided he would use
Imperial Sugars healthy line of credit to borrow funds and
increase capacity in the hope of eventually achieving a
prot, rather than admitting to the failure of the project.
The company thus borrowed indirectly, through Imperial
Sugar, from both the 15th Bank and International Trust,
and in the process succeeded in crippling the healthier
Imperial Sugar.

I. Kobe-Kawasaki Bank

The nal entry on my short list of member companies of
the Satsuma zaibatsu is the Kobe-Kawasaki Bank. It is an
interesting entry in that it, like kawasaki Shipbuilding, was
originally under the control of the Kawasaki family.
However, it too soon fell under Matsukata control with
funds provided by the 15th Bank. It was formed in 1905 by
the Kawasaki family as a limited partnership, and became
a full corporation only in 1917, at which time the 15th Bank
agreed to purchase half of the shares offered by the
company. The 15th Bank also insisted that a number of its
own board members, including Sonoda Kokichi and
Naruse Masayasu, be allowed to join the banks board of
directors at that time. These conditions, along with the fty
percent stock control, provided the 15th Bank, itself under
the control of the Matsukata family, with control over the
Kobe-Kawasaki Bank. It was eventually merely absorbed
into the 15th Bank itself, and became another part of the
Matsukata zaibatsu, a fate that was common to most if not
all companies that had once been considered components
of a Kawasaki zaibatsu.

V. An Assessment of the Satsuma Zaibatsu

The Matsukata brothers proved to be masters of the art of
indirect nancing for their companies. This type of
borrowing allowed them to disguise their true purpose for
acquiring funds and hide the abysmal performance of
certain companies. Goro was able to fund Kuji steel
through his Joban Trading Company, Shokuma funded
Hokkaido Sugar with money the banks made available to
the more protable Imperial Sugar, and Kojiro made use of
funds provided to Matsu Trading Company to acquire
everything from art to stock in other companies. In order to
tap these funds the Matsukata brothers made use of their
extensive ties with relatives and loyal Satsuma natives
within the 15th Bank.

Shokumas daughter, Haru Matsukata Reischauer, in her
biographical sketch of her uncle Kojiro, has said that if one
were to mention the name Matsukata in Japan today
the response is likely to concern the Matsukata
collection of art. If one were to have mentioned the name
in the 1920s, however, the response would have been
likely to be concerned with kawasaki Shipbuilding or the
Satsuma zaibatsu. One might have even heard something
about the Matsu trading Company, with whose funds, it is
said, Kojiro purchased the Matsukata art collection.

As I have previously shown, however, the funds for the art,
Kojiros Matsu Trading Company, along with the funds for
expansion at Kawasaki Shipbuilding, Goros Joban
Trading Company, and countless other ventures, actually
came from the 15th Bank. By controlling that bank the
Matsukata family was able to wrest control of the
Kawasaki zaibatsu away from the Kawasaki family.
Although it may have all been part of the same Satsuma
zaibatsu anyway, depending on ones denition and
viewpoint, I hope this article has been able to suggest why
the Satsuma zaibatsu was in fact merely a disguise for the
business interests of the Matsukata family. Although the
group of companies the Matsukata family created could
not rival the conglomerates built by the Mitsui, Sumitomo,
or Yasuda families in most respects, the Satsuma zaibatsu
does present an interesting study in the importance of
controlling access to funds. The Matsukata family
essentially commandeered the 15th bank, and with its
funds was able to outbid the Kawasaki family for control of
the Satsuma zaibatsu.

Endnotes

1 The reader is advised to consult Morikawa Hidemasa,
Zaibatsu: The Rise and Fall of Family Enterprise Groups in
Japan. (Tokyo: University of Tokyo Press, 1992), for a
more detailed discussion of the general attributes of the
zaibatsu.
2 Eleanor Hadley, Antitrust in Japan. (Princeton: Princeton
University Press, 1970), has shown, for example, that the
Occupation authorities had great difculty in deciding
exactly what constituted a zaibatsu. While it was generally
acknowledged that a Mitsui, Mitsubishi, Sumitomo and
Yasuda zaibatsu existed, a consensus was lacking
regarding other groups focused around the Shibusawa,
Furukawa, and other families, some of which became the
target of zaibatsu dissolution, and others of which did
not.
3 See Miyashita Kenichi and David Russell, Keiretsu:
Inside the Hidden Japanese Conglomerates. (New York:
McGraw, 1993), for an explanation of present-day
keiretsu.
4 Both the Economisto and s used this term in the 1920s.
See Mishima Yasup, Sasshu zaibatsu no spirits to hokai,
Kei-ei shigaku, 15 (April 1980), page 1. (Hereafter this
source will be referred to as Mishima.)
5 see Mishima Yasuos chapter on Kawasaki zaibatsu in
his book Nihon zaibatsu kei-eishi: Hanshin zaibatsu -
Nomura, Yamaguchi, Kawasaki. Tokyo: Nihon keizai
shinbunsha, 1984.
6 Mishima Yasuo. Kawasaki Shozo: seisho kara zosen-o
e in Nihon no kigyoka. Yasuoka Shigeaki, et al. eds.
(Tokyo: Yuhikaku, 1978), volume one, page 141.
8 The 15th bank was, of course, better known as the
Peers Bank, as a result of the fact that it was created from
capital provided by former daimyo and the feudal
aristocracy. For a general history of the 15th Bank, see
Thomas R. Schalow, The Role of the Financial Panic of
1927 and Failure of the 15th Bank in the Economic
Decline of the Japanese Nobility. Princeton University
Ph.D. dissertation, 1989.
9 See Haru Matsukata Reischauer, Samuraio and Silk: A
Japanese and American Heritage (Tokyo: Charles E.
Tuttle, 1986), page 265, for a short biography of Iwao.
(Hereafter this source is to be referred to as Reischauer.)
See Reischauer, pages 275-298 for a more detailed
biography of Kojiro, along with the Kobe shinbunshas
Karin no uni: Matsukata Kojiro to sono jidai. (Kobe: Kobe
shinbunsha, 1990). Okubo Tatsumasa, as editor of the
Matsukata Masayoshi kankei mono (Tokyo: Gannando
shoten, 1986), volume 7, pages 617-651, provides letters
written by Kojiro to his parents whir he was abroad. The
same source also provides letters by Iwao, Masao, and
Shosaku written during their sojourns abroad.
11 Haru Reischauer indicates that Kojiro happened to be
without a job and in the Matsukata home when Kawasaki
Shozo paid a visit to ask for some business advice. This
apparently led to Kawasakis decision to hire Kojiro.
Reischauer, page 278. Yamanouchi Sei-i. Hyogoken
jinbutsu retsuden Kobe: Wakansha, 1914, pages 344-347,
however, indicates that Kojiro began his employment at
Naniwa Fire Insurance in the year previous to this
encounter and was already ensconced in the Hyogo
region.
12 Mishima, page 20.
13 Reischauer, page 103.
14 Mishima, page 21.
15 For a discussion of Satsumas role in the navy during
the Meiji period see David Christian Evans, The Satsuma
Faction and Professionalism in the japanese Naval Ocer
Corps of the Meiji Period, 1868-1912. Stanford University
Ph.D. dissertation, 1978.
16 Mishima, page 11.
17 Mishima, page 12.
18 Yano Soro. Zaikai no hito hyakuninron. Tokyo: Jiji
Hyoronsha, 1915.
19 Nihon ginko chosakyoku. Nihon kinyushi shiryo: Showa
hen. Tokyo: Nihon ginko chosakyoku, 1969, volume 24,
page 493. Hereafter this source will be referred to as
Nihon kinyushi.)
20 Nihon kinyushi, volume 24, page 493.
21 Haruki Watsuji, Fune no omoide Tokyo: Kobunsha,
1948, pages 206-209.
22 SHiba Takao. Fukyoki no ni dai zosen kigyo: Taisho
koki no Mitsubishi zosen to Kawasaki zosenjo, Kei-ei
shigaku 18 (October 1983), page 5.
23 Ibid, pages 4-5.
24 Mishima, page 19.
25 Nihon kinyushi, volume 24, page 505.
26 Mishima, page 20.
27 Nihon kinyushi, volume 24, pages 503-504.
28 Asajima Shoichi. Nihon shintakugyo hattenshi. Tokyo:
Yuhikaku, 1696, pages 460-461.
29 Asajima Shoichi. Jugo ginokei no shintaku kaisha,
Shintaku (July 1968), page 21.
30 Nihon kinyushi, volume 24, page 502.
21 Nihon kinyushi, volume 24, page 504.
32 Jugo ginko enkakushi. Taisho period, volume 2, pages
57-60 (my pagination) provides a very brief history of the
bank.
33 Reischauer, page 298.
34 The reader ight wish to compare the discussion of the
origin of those funds presented by Reischauer, page 293,
and Nihon kinyushi, volume 24, page 505.

Bibilography

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