New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1920-05-28
Allied Institution
Suspension Caused
By the Mogi Failure
Yokohama Savings Bank Is
Affected by Closing, Silk
Industry Again Shaken;
To Check Importations

TOXIC, May 25 (By the Associated
Press) The suspension yesterday Of
the Seventy-fourth Bank Of Yokohama,
in which Sobei Mogi was the principal
shareholder, was followed to-day by
the suspension Of the Yokohama Savings
Bank. of which M. Mogi is president.
The Seventy-fourth Bank was heav-
lily interested in transactions in silk, cot
ton yarn and cotton cloth. This recent
slump in raw silk caused heavy de-
mands upon the bank by silk speculA-
tors, who were dependent upon the bank
for wlpport. and who had been Obliged
to pay additional margins. The Bank
of Japan, which had advanced 10000, 900
yen to the Seventy-fourth Bank, ceased
to advance funds to the institution, be-
lieving that the time for an adjust
ment had arrived. The directors, 1t Is
said, expect to settle by Offering their
personal property and securing the as
sistance Of other institutions.
thetic run was started after the closing
of the Seventy-fourth Bank, received
assistance from the Bank Of Japan and
did not have to suspend payments.
The suspension Of the Seventy-fourth
Bank, it was expected In commercial
quarters, might affect ono silk export
ing firm which had connections with
the bank. Jinosuke Inouve, the gov
ernor Of the Bank Of Japan, predicted
to the press that it would have no Sc
rious effects in other directions.
The suspension of the Seventy fourth
Bank was regarded es important be-
cause it was connected with operations
in silk, Japan's chief export to America.
The official statement Of the suspen-
sion announced that the bank had been
closed for only three weeks to permit
of the examination and adjustment Of
Its affairs. The suspension immedi-
ately forced the reclosing Of the Silk
Exchange and the newspapers attribute
Osaka stock markets, where the pxinci-
pal shares fell from 10 to 80 yen. to
the suspension Of the Mogi institution
and reported liquidations in America.
The conservative English language
newspaper, THE Herald Of Asia" In
discussing the economic situation, says
that apparently unlimited credit had
been extended by the banks, resulting
in wildcat speculation and the inordi-
wise policy, comments the newspaper
which abnormally inflated the national
currency. 1t points out that the Issue
of notes by the Bank of Japan for the
first four months of 1920 was the high
est in it's history. The loans at times
it says, totaled 700,000,000 yen, while
the notes issued exceeded 13o0,ooO,oo(
/ yen, or nearly five times the pre-wa,
volume.
The slump" continues the news
+ paper, "is q warning that limit mus
be set upon loans and speculation ~
takes an optimistic view Of the situa
ton, however, and predicts a recovery
to stable conditions.
conference has been held Of repre-
sentatives of the copper miners, ex
porters and importers, with view tc
the relief of the copper market. 1t was
resolved to restrict production, discon
tinue importations and discourage ex
portation Of accumulated material; also
to provide funds for purchasing stocks
offered at loss.