The Central Bank of the Democratic People's Republic of Korea is North Korea's central bank. Established on December 6, 1947, it issues the North Korean wŏn. The Bank is subordinated to the Cabinet of North Korea. Since 2023, the president of the bank has been Paek Min Gwang.[3]
History
In December 1945, the Pyongyang branch of the Bank of Chōsen created a temporary monetary office, known as the "calculation office". On 9 January 1946, the central bank of North Korea was created with use of all branches of the Bank of Chōsen on North Korean territory.[4] In practice, that central bank was under the control of the Soviet Armed Forces.[5] It was complemented in April 1946 by the creation of a Farmers' Bank.[4] However, the Soviet-controlled central bank failed to accomplish its objectives, being unable to meet its costs of operation, and its 100 million wŏn capitalisation proved to be insufficient,[6] and the North Korean Interim People's Committee opted to work mainly through the Farmers' Bank.[6]
On 29 October 1946, the system was reorganized. 58 local banks were merged into the central bank, including North Korean operations of Japanese-era Korean banks headquartered in Seoul such as Chōsen Commercial Bank, Chōsen Savings Bank, or Chōsen Trust. Simultaneously, control of the central bank was taken over from the Soviet forces by the North Korean government through its finance ministry.[4] By 1947, the Central Bank and Farmers' Bank were the only two credit institutions in the country and together formed its single-tier banking system in line with the Soviet model. In June 1947, around 1,000 million wŏn was concentrated in the Central Bank, allowing it to extend credits totalling 900 million wŏn for economic rehabilitation.[7] The consolidation reflected a return to the original objectives of the People's Committee, which desired tight control over the North Korean economy. Any bank employees opposed to the changes within the system were removed from their posts.[7] On 6 December 1947, a comprehensive program of currency reform was announced.
In 1959, the Farmers' Bank was merged into the Central Bank of the Democratic People's Republic of Korea, and the Foreign Trade Bank was established to handle the Central Bank's international business.[8] Further state banks to deal with foreign exchange operations were created between 1987 and 1996.[9]: 10
Organization
The Central Bank has over 220 branches.[8] It operates the Chŏnsŏng electronic cash card.[10]
