The Mysterious Copper Coin Notes Issued by the Bank of Local Currency Kiangsi

In all of the published literatures about the finances of Kiangsi province, one official financial institution, The Bank of Local Currency Kiangsi ("the Bank"), is always mentioned. It was recorded that the Bank once issued copper notes with denominations in "Shih Mei" (拾枚, "10 Yuan"), "Nien Mei" (念枚, "20 Yuan") and "Yi Bai Mei" (壹佰枚 , "100 Yuan"). But prior to 2009, the records of these notes could not be found in any related literatures or banknote catalogs including even the Standard Catalog of World Paper Money, and it seemed that the story of the Bank issuing the copper notes was only a legend.

For those collectors who do not know, the Bank was the first local financial institution in Kiangsi when the Kuomintang [KMT] settled there during the Northern Expedition period. The Bank only lasted a very short time, but it was said to have issued the banknotes, which have attracted the interest of many collectors and scholars since. In the modern financial history of Kiangsi Province, the Bank was set up at the time when the Kuomintang Government took over the Peiyang Government; so the Bank witnessed the regime shift and the change in the financial order.

In 2007, a whole set of copper notes issued by the Bank was auctioned by John Bull Auctions in Hong Kong [unfortunately, the catalog didn't have illustrations of them]. These notes were from the Russian collection of Mr. and Ms. Shmirnov. The copper note with denominations of Shih Mei (拾枚), Nien Mei (念枚) and Yi Bai Mei (壹佰枚) depict a very popular pattern of Yangtze River scenery on the observe. On the reverse, the "Shih Mei" features the Zhenliu Bridge near to the White Deer Grotto Academy in Lushan; the "Nien Mei" features Xiaogushan (a butte) in the middle of river; and the "Yi Bai Mei" features Jinshan Temple in Zhenjiang, Jiangsu Province. The serial numbers of these notes were prefixed with the Chinese characters "Rong" (融),"Wei" (维), and "Ping" (平) respectively, followed by a 6-digit number. Notes with different denominations were overprinted with a 6-digit number in different colors: "Shih Mei" in purple, "Nien Mei" in black and "Yi Bai Mei" in blue. The paging seal on the banknotes was rectangular. The copper notes were illustrated with descriptions from the books Local Banknotes of Kiangsi Province by Xu Anmin (published in August 2009 by the Kiangsi People’s Publishing House), and The Catalog of Banknotes in the Republic of China by Xie Zhiwei (published in April 2014 by the Nanjing University Publishing House).
 

The Bank of Local Currency Kiangsi 1927 “Shih Mei”, rescripted by Yumin Bank of Kiangsi. Aguang Chan collection

In November 1926, when the Army of the Northern Expedition attacked Nanchang, the capital city of Kiangsi Province, people there were suffering from the "Kiangsi Banknote Issue" (江鈔風潮). In the late Peiyang Government period in Kiangsi, the banks issued the banknotes so excessively that the government was forced to merge several banks into the Local Bank of Kiangsi (江西地方銀行) in an attempt to stop the devaluation caused by the excessive printing. But at that time, the government had to continue to issue the banknotes in the name of the Bank of Kiangsi Province in order to disburse the huge military spending and administration charges. This caused the banknotes to depreciate, so the banknotes were not accepted and used in commerce. Thus people used copper coins instead of banknotes. After the Army of the Northern Expedition took over Kiangsi, Banknotes with "Fu", "Xing", and "Long" (復興隆) in circulation were canceled and other former banknotes were circulated but at a 80% discount to their face values. This caused silver coins to disappear from the market, and commerce and people’s living standards were badly affected.

In early 1927, the Financial Committee of Kiangsi Province decided to set up a local financial institution named The Bank of Local Currency Kiangsi in order to rescue the financial market, and to resolve the shortage of copper coins. The total capital was 500,000 silver dollars divided into 5,000 shares. The Bank opened up in the old site of the Bank of Kiangsi Province on 9th May 1927, and started to issue the copper notes. The total number of copper notes printed equaled 1,300,000 strings (the value of a string of copper notes equaled 100 copper coins), of which the first issue overprinted 500,000 strings and the second issued 129,000 strings. But these copper notes were not popularly accepted by the public because people still were scared by their experiences of the "Kiangsi Banknote Issue", and the reserves of the Bank were not sufficient which caused several bank runs. The issues ceased in November, and the aftermath was dealt with by the newly founded Yumin Bank of Kiangsi. At the beginning, the Yumin Bank of Kiangsi overprinted the copper notes issued by The Bank of Local Currency Kiangsi, and the paging seal was also changed into the round stamp of the Yumin Bank of Kiangsi, which became the revised copper notes. The Bank of Local Currency Kiangsi had three branches: the East Branch in Fuzhou (撫州), the South Branch in Ji'an (吉安) and the North Branch in Jiujiang (九江). All the notes issued by these branches used their own place names. So there were two kinds of copper notes: one without the place names and the other with place names such as Jiujiang, Guling (牯嶺, a town in Jiujiang), Ji’an and so on.

In order to retrieve the copper notes issued by the Bank of Local Currency Kiangsi, the Finance Department purchased a great amount of copper coins from other provinces as the reserve. Among the totally issued 649,000 strings of copper notes, 557,500+ strings were bought back on the open market, so 91,500 strings were not retrieved. The unissued 651,000 strings were still in the bank. On 19th June 1928, all of these copper notes were destroyed, and the copper notes were no longer used in circulation.

The legend of the Bank of Local Currency Kiangsi and its issued copper notes were born in the period of the first acts of the Chinese Civil War. Even though the notes were issued only in three denominations, the revised issue by the Yumin Bank of Kiangsi and the fact that some of the notes were overprinted with different place names means there are many varieties. The Bank started business and in only half a year later it was closed. Even though it was a very small issue in Chinese banknote history it is worth learning about.

The copper note is very rare now due to its short circulation period, comprehensive retrieval from circulation and the fact that most of them were destroyed.