Initially
banknotes and
coins were produced and
minted by the
Bank of Japan, but were later issued from the mint of the
Central Bank of Manchou in the Manchukuo capital of Hsinking (now
Changchun) with branch offices in
Harbin,
Mukden,
Jilin, and
Qiqihar. The Central Bank of Manchou was opened on 1 July 1932 with a ceremony attended by the Emperor of Manchukuo in person, the new central bank acquired the assets and continued the responsibilities of the previous four banknote issuing banks in the region of Manchuria. The currency that circulated in Manchuria prior to the introduction of the Manchukuo yuan consisted of the banknotes of various provincial banks as well as commercial banks, silver smelting shops (known as yinchang), and
pawn shops. Types of old banknotes recovered and later destroyed included high denomination banknotes, banknotes denominated in copper coins, official provincial notes issued by the banks of the provincial government, small denomination coin notes,
tiao/diào denominated notes,
jiao denominated notes and others. The 15 different types of currency that circulated in Manchuria prior to the introduction of the Manchukuo yuan were allowed to be exchanged for the new currency by degree for a period of three years, using this method ninety-five point four percent of all previous Manchurian currency that was still in circulation, and the destruction of these old banknotes was handled by officials from the Department of Finance of the government of Manchukuo. The old banknotes were first shredded by machines and then burned, but the number of banknotes that had to be destroyed proved so numerous and new hearths would have to be constructed to burn all the old paper money. Due to worldwide fluctuations in the price of silver during the 1930s, Manchukuo took the
yuan off the
silver standard in 1935 and subsequently
pegged the
yuan to, and later reached approximate exchange
parity with, the
Japanese yen. In 1940 the Manchukuo yuan was being used to measure Manchukuo exports and imports to countries that included America, Germany and Japan. Throughout this period about half the value of the issued notes was backed by specie reserves. The notes issued were in five denominations, one hundred, ten, five and one
yuan and five
jiao (one-half
yuan), and typically depicted
Qing dynasty rulers of China on the
obverse. To keep up with the
inflationary pressures typically experienced by Japanese-controlled areas towards the end of
World War II, a 1,000
yuan note was issued in 1944. The Yuan was subdivided into 10
jiao (角), 100
fen (分) or 1000
li (釐).
Coins were issued in denominations of 5
li up to 10
fen. In 1944 and 1945, Manchukuo issued coins (1 and 5
fen) made of what the
Standard Catalog of World Coins describes as "red or brown fiber", resembling
cardboard. These are a rare example of non-metallic coins. As a matter of policy, the United States prevented any trading in the currency. This made it more difficult for the nation to access the American credit market. In 1948, after the end of
World War II, approximately 12 billion
yuan of Central Bank of Manchukou notes were redeemed by the Tung Pei Bank. == Banknotes ==