EMERGENCE AND COLLAPSE OF SASSHU ZAIBATSU

Abstract

Syozo Kawasaki, the founder of Kawasaki Shipyard, died in 1912. Kawasaki Sohonten (limited partnership), the holding company of Kawasaki family, was founded by his daughter and grandsons in 1920. While Kojiro Matsukata, the president of Kawasaki Shipyard since 1896, founded Matsushokai in 1920, his own holding company. And Matsushokai held increasingly more stocks of Kawasaki Shipyard than Kawasaki Sohonten. Matsukata brothers operated many companies of shipbuilding, iron manufacturing, sugar refining and machine manufacturing. These companies borrowed much funds from Jugo-Ginko, whose president was Iwao Matsukata, their eldest brother.
Both of Kawasaki and Matsukata family came from Kagoshima prefecture, so this group of businesses was called Sasshu (old name of Kagoshima) Zaibatsu. All of these companies overborrowed and overinvested at the period of financial panic in 1927, so they were on the brink of ruin. The family of Kawasaki and Matsukata retired from their companies and thus Sasshu Zaibatsu collapsed at that time.