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Although several regional trust companies were absorbed by their parent banks as the government took firmer control of the finance industry during World War II, the Sumitomo Trust Company retained its independence as a specialist trust company, only to be engulfed by the postwar economic upheaval. The decline of the wealthy class, consumers turning away from long-term savings (i.e., money trusts) because of hyperinflation, and the ban on securities underwriting drove the company into a corner. Yet its social mission of postwar rehabilitation through its own efforts was unchanged. In 1948, the company decided to combine trust and commercial banking operations to meet the demands of the times and ensure its survival.
Even after it started commercial banking operations, the company remained committed to serving society. In June 1952, when it changed its name to The Sumitomo Trust & Banking Co., Ltd., a new system called loan trusts—later to become synonymous with trust banks—came into being. Sumitomo Trust & Banking was the driving force behind the development of loan trusts, which were designed to supply long-term funding to key industries by absorbing the nation’s savings at a time when Japan was finally embarking on postwar reconstruction in earnest.
The massive capital market created by loan trusts was a powerful resource propelling Japan’s fast economic growth. Once again, Sumitomo had made a substantial contribution to society. |
