|Earthquakes and People's Health (WHO - OMS, 1997, 296 p.)|
|PART 4 - REHABILITATION|
1 Y. Yasuda is General Manager, Kansai Project Development Division, The Sakura Bank Limited, Kobe, Japan.
I am General Manager of Sakura Bank's Kansai Project Development Division which is supporting local governments and other bodies in redeveloping certain areas in western parts of Japan, including the Kansai district.
Sakura Bank during the Great Hanshin-Awaji Earthquake
Sakura Bank was established in 1990 by the merger of Taiyo Kobe Bank and Mitsui Bank. It is one of the leading Japanese banks with total assets of US$ 498 billion. It has 530 domestic branches and 46 overseas offices.
Hyogo Prefecture, including Kobe City, is one of our bank's most important markets. That is the reason why the former Taiyo Kobe Bank's head office was here and Sakura Bank still has 121 branches here.
Due to the earthquake, most of the branches in Kobe City and the Hanshin area (the area from Kobe to Osaka) were damaged. Five branches completely collapsed and a further 20 branches were seriously damaged.
On that day, 119 out of 186 branches in the Kansai region were unable to operate as the result of failure of electric power and telecommunications services.
The restoration of the bank's facilities
Sakura Bank was fully equipped with computer systems. The main host computer was located in Kanagawa Prefecture near Tokyo and the second host computer in Kobe. The design of these computer systems took into account that even if one of them broke down, the other should provide the bank with all its normal electronic services. Despite the earthquake, however, both computer systems remained functional. They continued to work very well, although they were affected by the disruption of the electric power supply and of damages in the communication network between the headquarters and branches.
However, the bank faced another serious difficulty. Equipment and documents were scattered all over the offices. Only a few bank personnel came to the office that day. In addition, the bank suffered from the destruction of the lifelines.
Under these circumstances, the staff tried very hard to restore the bank's facilities, considering that many people affected by the earthquake needed money and relied on the bank. Due to the rapid and hard work of our employees, the computer network systems were working again two days after the earthquake and on 23 January all branches were able to operate fully. Thus most of our customers felt relieved and there was no rush to the bank offices. In fact, it was said that most people felt relieved to see the bank's headquarters safe among so many destroyed buildings.
In Japan, it is generally said that banks are built so strong that they can resist earthquakes. But this myth was destroyed by this earthquake. I had lived here for a year and a half, and I saw things after the earthquake from the point of view of a victim as well as that of a bank employee. Crisis unexpectedly attacks our lives and our property and we should prepare ourselves against such crises and emergencies in both public and private affairs.
Like other companies, Sakura bank had a manual for emergency management. It was thorough but could not cover everything. Therefore the bank staff needed to act with flexibility in response to the real situation.
The bank's actions
On the day of the earthquake, the transportation systems were completely paralyzed and only 10 out of 600 employees were able to arrive at the bank's headquarters by 8 o'clock in the morning. However, as soon as employees arrived, the bank formed an emergency command centre both in Kobe and in Tokyo and tried both to check whether other employees were safe and to confirm what damage had been done to the branches in the area. It was difficult to do these things because of the lack of electricity, disrupted telecommunication systems and the shortage of staff. Most of the bank staff were, however, enthusiastic enough to come to their offices, some travelling three or four hours on foot, to restore the bank's facilities. As a result, out of 119 branches that were closed on 17 January, 75 were open by the next day.
The Bank of Japan gave top priority to supplying enough cash for all the banks in the area of destruction; staff were kept busy paying out cash. As a result we avoided social disorder. Sakura Bank kept three times as much cash reserve as normal for several days after the earthquake in order to pay customers whatever they needed to withdraw. The bank also had about 10 staff members dealing exclusively with customers' phone inquiries, both in Kobe and also in Tokyo, since it was not always easy to use phones in the Kobe area.
Besides these activities, Sakura Bank called on its employees and customers outside the disaster area to make donations on behalf of the victims. Donations by the bank's employees amounted to 25 million yen.
Treatment of depositors
This huge earthquake threatened Japan's banking system, with its dependence on on-line computers, for the first time. It made us realize the importance of the stability of the banking system in a modem urban environment. I believe that the special emergency procedures laid down and practised by the Ministry of Finance and the Bank of Japan reassured the earthquake victims. These procedures required that:
- even if the customer's passbook and other documents were lost or burned, the bank should take proper steps to check the person's identity and be ready to pay out;
- the bank should pay out fixed-term deposits even prior to the maturity date, as long as this was acceptable to the bank;
- the bank should open on Saturdays and Sundays to attend to the needs of customers;
- the bank should make special arrangements for new loans related to recovery from the disaster.
Sakura Bank and other banks tried very hard to comply with these procedures. The Kobe branch of the Bank of Japan and the Kobe main office of Sakura Bank also offered space to other banks, whose offices were too badly damaged to open, and helped them carry out their business.
Treatment of customers with loans
On 18 January, Sakura Bank announced special arrangements for rescheduling repayment of loans, for extension of loan periods and for lowering the interest rate in cases of necessity. In addition, low interest loans were introduced for individuals and enterprises who had suffered in the earthquake.
The bank also released its collateral interest in destroyed or fire-damaged houses that were security for loans, and allowed the owners to use the fire and earthquake insurance money for the specific purpose of building new residences.
Helping earthquake victims to rebuild their lives
Sakura Bank established three kinds of loans for the earthquake victims. Firstly, the bank set up home loans so that those who had lost their homes could build new ones. These were 40-year loans with a three-year grace period at an interest rate 0.7% lower than for normal home loans. Secondly, the bank set up home repair loans for repairing damaged residences. Interest on these loans is 2.25% lower than for normal loans of this kind. Thirdly, there were loans for support of living, without security, to help earthquake victims get through the difficult situation. This kind of loan was up to 3 million yen for a period of seven years, with a one-year grace period at an interest rate 4% lower than normal. The bank also allowed persons with existing home loans with mortgage to apply for the new home loans.
The Housing Loan Corporation, a government agency, also set up the same kind of special home loans. So those in need were able to choose from many kinds of loans. However, these special arrangements were not applied to elderly people or to those with low incomes. This is still a big problem today.
For customers planning to reconstruct apartment buildings, Sakura Bank took the lead in discussing financing loans and agreed to suspend mortgage obligations temporarily in some cases. According to a survey by the bank, 117 of 232 damaged apartment buildings needed to be reconstructed. Among them, however, agreement about reconstruction among the usual multiple owners was reached for only 78 buildings. (I am afraid that it will take a long time to reach agreement on reconstruction of the rest.)
Sakura Bank set up special counters at all its branches in the Kansai area to give advice to people in need of loans.
Support for reconstruction
After the earthquake, the government and local authorities worked hard at rescue, near-term survival and plans for reconstruction. On 1 February, Sakura Bank formed a task force for reconstruction open to cooperation with the authorities. The task force set up its own working fund to assist small and medium-sized enterprises in addition to the local government's financial help.
On 1 March, the bank established a Reconstruction Promotion Department in Tokyo and a Reconstruction Project Department at the headquarters in Kobe. These took the place of the task force in cooperating with government and local authorities. Since then the bank and its affiliated Sakura Research Institute has made various proposals for reconstruction.
Now the local governments of Hyogo Prefecture and Kobe City, and other bodies, have four big national projects for reconstruction. These are the promotion of trade and relationships between Kobe, Shanghai and the Yangtze valley, the construction of a health care park (in the same development area where the new headquarters of the WHO Centre will be located), the creation of new industries, and memorial events of the Great Hanshin-Awaji Earthquake. These projects will be carried out by the governments, the local authorities and private companies.
As a leading bank in Kobe, Sakura Bank has committed itself to cooperating with and supporting the said bodies in carrying out these reconstruction projects in the near future.