JP (Japan Post) Bank Overview:
- Is Japan’s Postal Bank, which mainly used only for savings and deposit (and supposedly free of exotic financial instruments).
- Is 100% owned by JP Holdings
- Was one of the biggest deposit holder in the world
- Originated by the “Postal Savings” policy, at that time JP Bank was owned and operated by government in 1875, then privatized in 2004 under initiative of Prime Minister Koizumi, enabling it to be managed like a corporation instead of a government arm. Then it was consolidated into JP Holdings in 2006
- Was very traditionally unique bank, run in a very conservative way, proven by its following financial characteristics: 1) Liabilities mostly consists of customer deposits (92% of Total Liabilities); 2) Other liabilities are mainly payables, i.e. no significant loan owned to other parties; 3) Assets mostly consists of Japanese Government Bonds (62% of Total Assets), “Other Securities” (11% of Total Assets), Due from other banks (9% of Total Assets), and Japanese Corporate Bonds (9% of Total Assets).
Zenginkyo (全国銀行協会), a.k.a. Japanese Bankers Association (http://www.zenginkyo.or.jp/en/)
- Is an association of Japanese banks, Japanese banks’ holding companies, and regional bank associations which has 4 main functions. Among those functions, the most important one is the operation of payment systems. Zenginkyo has an interbank connection named “Zengin” which enables Japanese banks to transfer money to each other (on behalf of their customers of course).
- Has 254 total members (as of April 2014), consisting of 120 Full Members (banks), 3 Bank Holding Company Members (bank holding companies), 71 Associate Members (banks), 59 Special Members (regionally-based bankers associations) and 1 Sub-Associate Member
So what’s the connection between JP Bank and Zenginkyo (and international money transfer)?
JP Bank was not a member of zenginkyo until 2009 (and then finally became a full Zenginkyo member in 2011 ). Prior to joining Zenginkyo, JP bank couldn’t enjoy the interbank network among Zenginkyo members, making it impossible to wire transfer from a JP Bank account to other Japanese bank and vice versa. Moreover, since JP Bank was not exposed to interbank connection, it also couldn’t do wire transfer to overseas bank.
But now JP Bank also provides international money transfer using SWIFT connection, enabling its account holders to send and receive money to overseas bank accounts. In its SWIFT transfer mechanism, JP Bank uses Deutsche Bank as its intermediary. Details of the remittance from overseas bank to a JP Bank account can be found here: http://www.jp-bank.japanpost.jp/en/djp/en_djp_index.html
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