Hokkaido Takushoku Bank
| Company type | Public (former) |
|---|---|
| Industry | Banking, Financial services |
| Founded | February 2, 1899 |
| Defunct | 1997 |
| Fate | Bankruptcy; branches absorbed by North Pacific Bank and Chūō Mitsui Trust and Banking Co. |
| Successor | North Pacific Bank (Hokkaidō branches), Chūō Mitsui Trust and Banking Co. (other branches) |
| Headquarters | Sapporo , Japan |
Area served | Primarily Hokkaidō; nationwide expansion from mid-1980s |
| Products | Long-term loans, short-term loans, commercial banking services, real estate financing |
The , known in English as the Hokkaidō Development Bank and alternatively referred to as or , was a prominent financial institution headquartered in Sapporo, Hokkaidō. Founded between 1899 and 1900 as a policy-driven entity, its primary mission was to stimulate capitalism and economic growth within Hokkaidō, while also bolstering regional security against the Russian Empire. It functioned alongside other specialized banks such as Nippon Kangyo Bank and Industrial Bank of Japan.
Following World War II, the bank's special designation was rescinded, transforming it into a commercial "city bank" with a focus on Hokkaidō. By the mid-1980s, it had expanded its operations nationwide, ranking as the tenth-largest bank in Japan by total assets by 1997. Nevertheless, it collapsed amid the Japanese financial crisis that year, representing one of the most chaotic failures within the industry.
Policy bank
In accordance with the 1896 agriculture and industry banking legislation, "agriculture and industry banks" were established throughout Japan’s prefectures. However, Hokkaidō received special attention for economic advancement through the creation of a dedicated "national policy bank." Consequently, Hokkaidō Takushoku Bank was founded on February 2, 1900, offering long-term loans at low interest rates aimed at developing crucial sectors including agriculture, industry, fisheries, and natural resource exploitation.
Distinct from other regional financial institutions like Nippon Kangyo Bank and Industrial Bank of Japan, Takugin concentrated solely on Hokkaidō until the post-World War II era. In 1939, its role broadened to encompass managing bank accounts and providing short-term loans, effectively merging functions typical of ordinary and savings banks. This expansion considerably enhanced its scope of operations. During wartime consolidation efforts, all banks connected to Hokkaidō and Karafuto were unified under Takugin’s control.
Commercial bank
The abolition of the Hokkaidō Takushoku Bank law in 1950 led to Takugin’s conversion into a standard commercial bank. By 1952, the issuance of "exploitation bonds" was discontinued and transferred to the Japan Long-Term Credit Bank. In 1960, Takugin became part of the City Banks group.
In March 1963, Takugin assumed responsibility for managing the Hokkaidō lottery. Within Hokkaidō, it was common for most households to maintain accounts with "Mr. Takugin," and nearly every municipality counted among its clients. Although it was the smallest City Bank in terms of size, Takugin earned widespread recognition as the "bank of the people of Hokkaidō."
Around 1962, Takugin introduced Takuchan ("little Taku"), a brown bear character used as a mascot. Takuchan-themed savings boxes have since become sought-after collectibles. From 1989 onward, Takugin incorporated a Sanrio character into its branding efforts.
Expansion and collapse
Beginning around 1985, mirroring trends among many banks, Takugin extended its branch network to major cities such as Tokyo and Osaka, while increasing its involvement in real estate financing. Whereas conventional lending typically capped loans at 70% of property value, during the bubble economy loans were granted at 120–130% based on anticipated land value appreciation. Takugin entered this market more cautiously and often held subordinate collateral positions behind other lenders, which diminished recovery prospects in cases of borrower default—a vulnerability that became evident when the bubble burst.
During the recession of the 1990s, Takugin’s non-performing loans surpassed ¥1 trillion with scant possibilities for recuperation. For instance, it had extended over ¥120 billion in financing to Sapporo-based real estate company Kabuto Decom. Following the collapse of the bubble economy starting in 1993, Takugin intensified efforts to reclaim debts, initiating legal proceedings against Kabuto Decom’s president. A Ministry of Finance report from 1994 disclosed that despite unresolved bad debts, lending totaling ¥10 billion continued to be directed toward resort enterprises.
Failed Merger Attempt with Hokkaidō Bank
By March 1997, non-performing loans represented 13.4% of Takugin's total credit portfolio, marking the highest ratio among City Banks amid ongoing economic instability and liquidity challenges. To avert the collapse of key financial institutions—an initiative dubbed "don't crush the big 20"—the Ministry of Finance proposed a merger between Takugin and Hokkaidō Bank (Dohgin), Hokkaidō's second-largest bank, which was also experiencing financial difficulties. The strategy involved maintaining Takugin’s operations temporarily, with a full consolidation planned for April 1998 to create the New Bank of Hokkaidō.
Nevertheless, deep-seated mistrust regarding the evaluation of bad debts and a historical rivalry led to strong resistance from Dohgin’s employees. Consequently, by September 1997, the merger was indefinitely delayed and effectively abandoned.
Deposits had reached a peak of ¥8.7 trillion in 1994 but declined to ¥5.9 trillion by September 1997, largely due to contract violations and capital withdrawals, particularly in Honshū. Following the failed merger, Takugin’s financial condition deteriorated further; its stock price dropped beneath critical bankruptcy alert levels. Despite facing liquidity shortages, the bank managed to raise funds through high-interest fixed-term loans from major creditors and borrowing in the call money market.
Insolvency
On 4 November 1997, the bankruptcy of Sanyō Securities caused the Central Gunma Trust Fund (currently Gunma Trust Fund) to default on approximately ¥1 billion in unsecured loans. This event sparked turmoil in the unsecured call market, leading to emergency reductions in credit lines that severely constrained Takugin’s cash flow. With its share price falling to 59 yen, Takugin approached the critical threshold of 50 yen.
Cut off from call market financing and abandoned by government support, Takugin announced that it would cease all funding efforts the following week. On 17 November, an urgent board meeting held at the Palace Hotel, Tokyo resolved to halt business operations entirely. This decisive action, coordinated with U.S. regulatory authorities, subsequently triggered a rebound in market confidence.
Aftermath
Following Takugin’s collapse, its Hokkaidō branch network was integrated into North Pacific Bank, which ranked as Hokkaidō’s third-largest bank after Takugin and Dohgin. Branches outside Hokkaidō were transferred to what is now Chūō Mitsui Trust and Banking Co. After Chūō Mitsui Trust's establishment, most former Takugin branches outside Hokkaidō were closed except for those affiliated with Takugin’s longstanding partners located in Shakujii (Tokyo) and Sugido (Saitama).
The consolidated financial institution code assigned to Takugin was 0012.