Chapter

The Rise and Decline of the Oriental Bank Corporation, 1842–84

Toshio Suzuki

in The Origins of International Banking in Asia

Published in print August 2012 | ISBN: 9780199646326
Published online September 2012 | e-ISBN: 9780191745256 | DOI: http://dx.doi.org/10.1093/acprof:oso/9780199646326.003.0004
The Rise and Decline of the Oriental Bank Corporation, 1842–84

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This chapter covers the Oriental Bank Corporation. Prior to the development of British banks operating in India and the Far East it was the East India Company that dominated international financial transactions both internally and externally. The Oriental Bank was the earliest British bank to challenge the East India Company and it did so successfully, becoming the largest bank in the region. Thus its collapse was both spectacular and a major blow to British banks in the Asia. What this chapter reveals is both the mistakes by management that led to the bank’s demise and the contribution made by monetary instability. The former involved excessive lending, especially in Ceylon. The latter was related to the collapse in the value of silver, on which Asian currencies were based, compared to gold, which was the basis of an increasing number of western currencies. The lessons learnt by British banks from the collapse of the Oriental bank made an important contribution to British banking stability in Asia in subsequent years.

Keywords: Oriental Bank Corporation; monetary instability; ceylon; silver; gold

Chapter.  10049 words.  Illustrated.

Subjects: Business History

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