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| Japan’s finance industry was in crisis amid the economic depression following World War I, with many banks going under. People rushed to withdraw their bank deposits. Photo courtesy of the Mainichi Newspaper. |
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At the time, Sumitomo’s financial arm consisted of a bank and certain involvement in a non - life insurer, and in 1924 it had launched preparations to establish a trust company and had been studying the prospects for a life insurance business as well. However, not only were there conservative opinions within Sumitomo, but there was also a boom in the insurance industry, with about 40 companies trying to get in the door, and the authorities had expressed reservations over the establishment of yet another.
At this juncture, Masatsune Ogura, executive director of Sumitomo Goshi - Kaisha, who had been interested in the life insurance industry for some time, received a report from Sumitomo Bank, which took note of the excellent way Hinode Life was run:
“Life insurance is a steady business with great potential to benefit the public, but life insurers have no chance of success without the trust of customers and the public. Hinode Life is an excellent company that has built such trust, making it eminently suitable for inclusion under the Sumitomo umbrella. If a trusted entity such as Sumitomo were to get involved in this meaningful enterprise, it would be able to further benefit society.”
Ogura’s convictions about the life insurance business strengthened even further. It was not long before Ogura sent a detailed and passionate message to all of his managers, even the conservative ones, in an effort to persuade them. After numerous deliberations, Sumitomo Goshi - Kaisha decided to take over all of Hinode Life’s stock, and in June 1925, the two companies exchanged contracts.
“Sumitomo’s goal is not to share dividends,” said Ogura addressing the managers he was sending to Hinode Life. “Sumitomo’s goal is to make Hinode Life a great company and to be of service to society. I don’t want you to worry about dividends; instead, concern yourselves primarily with the company’s future.” |
