True Gold Fears No Fire: 150 Years of Tse Lee Yuen (謝利源)

York Lo: True Gold Fears No Fire: 150 Years of Tse Lee Yuen (謝利源)

Founded in Macau in 1867, Tse Lee Yuen (also known as Che Lei Un and Che Lee Yuen and now known as O’Che 1867) is one of the oldest jewelers in Macau which is still going strong under the management of the fourth generation. In the 1970s and early 1980s, Tse Chi-chiu from the third generation of the Tse family built Tse Lee Yuen Jewelry into one of the largest jewelers in Hong Kong through aggressive marketing and innovative schemes before its dramatic collapse in 1982 which triggered a banking crisis.

Che Lei Un: the First Century in Macau

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Tse Lee Yuen founder Tse Yu-tong (back row, third from the right) with his sons Tse Choi-sang (back row, second from right) and Tse Wing-sang (front row, fourth from the right) and grandchildren such as Tse Chi-sun (front row first from the left).

A native of Nanhai, Tse Lee Yuen founderTse Yu-tong (謝瑜堂) was born in Macau in 1850 and established Che Lei Un Ourivesaria (謝利源金鋪)in Kiu Tsai Tou in Macau in 1867 at the age of 17 to make and sell silver jewelry. In 1880, the firm expanded to the production of gold jewelry.

In the 1910s-1920s, Yu-tong’s sonsTse Choi-sang (謝再生) and Tse Wing-sang (謝永生) – who adopted their names which meant “Born Again” and “Eternal Life” after they became Christians – joined the family business and the firm moved to22-26 Rua Dos Mercadores in Macau where the family operated three other businesses – Lei Fong Mercearia (利豐油米行) which sold rice and oil, Fanva Quin Quilharias (繁華百貨行) which sold imported cosmetics and general merchandise and Fan VaSedas (繁華絲綢莊), which sold silk and fabric in addition to Che Lei Un. An innovator,Tse Choi-sang came up with the gift voucher shown below which customers could use any of the four businesses on Rua Dos Mercadores, a first in the retail trade in Macau which became very popular at the time.

During the Japanese occupation of HK, many HK residents left for Macau, which was neutral territory as a Portugese colony, but business conditions were still tough with limited supply of food and electricity. In 1944-46, Che Lee Yuen became the first in Greater China to use electrolysis to refine gold in a commercial scale and the first to use carbon to dissolve platinum. As discussed in other articles earlier such as the one on Y.C. Liang and K.T. Kan, Macau became an international center of gold trade in the late 1940s and Che Lee Yuen definitely benefited from the activities.

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A coupon that was valid in all four of the Tse family’s businesses on Rua Dos Mercadores in Macau with pictures of thejewelry, silk and department store on the left and rice store on the right.

Tse Choi-sang and his brother Wing-sang married sisters and Choi-sang had 7 sons and 6 daughters according to the obituary of his wife Pau Sau-chun (WKYP, 1978-8-3)His eldest son Tse Chi-chiu (謝志超, hereafter refer to as C.C. Tse) and second sonTse Chi-sun (謝志新, 1924-2012) both went to Hong Kong after the War where they entered the garment business.Born in 1921, C.C. Tse started the trading firm of C.C. Tse& Co (捷昌洋行) in HK in 1959 which counted the British retail giant Tesco as a client/partner in the 1960s. (WKYP, 1967-3-10) His C.C. Tse Group of Companies (incorporated in 1971, renamed Tse Lee Yuen Holding in 1980) grew to include at least four garment factories by the 1970s and he also had a private villa in Tai Po which included a swimming pool, tennis courts and gardens for the use of his two wives, children and friends. Another son Tse Chi-shing (謝志成) went to the mainland and became a scientist and professor at the prestigious Tsinghua University.

Choi-sang’s sixth son Daniel Tse Chi-wai (謝志偉) GBS CBE JP as the longtime president of HK Baptist University is probably the highest profile member of the family. Born in Macau in 1934, Daniel studied at Pui Ching in Macau and Baptist College in HK and received his bachelor and master degrees from Baylor University and PhD from University of Pittsburgh. He became the president of HK Baptist College in 1971 at the age of 37 and ran the school for three decades, during which it was elevated to university status in 1994 and he also served on the Kowloon City District Council and the Legislative Council from 1985 to 1991. After his retirement from HK Baptist University in 2001, he was asked to chair the University Council of the University of Macau. For both universities, he leveraged some of his family connections to secure donations from tycoons such as Wu Yee-sun, the founder of Wing Lung Bank who was a peer in the gold trade with his father.

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C.C. Tse (second from left) entertaining his younger brother Tse Chi-wai (first from left) and his colleagues at HK Baptist College in his mansion in Tai Po in 1971 (WKYP,1971-10-24)

The Rise and Fall of Tse Lee Yuen under C.C. Tse in Hong Kong: 1973 to 1982

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Left: front page ad for Tse Lee Yuen’s 3 in 1 service in 1979 (WKYP, 1979-10-22); right: Tse Lee Yuen’s flagship store at 364-366 Nathan Road in Yaumatei

Even though Tse Lee Yuen had been operating out of Macau for over a century by the late 1960s, it never opened a HK branch up to that point. After Choi-sang died, Wing-sang succeeded him as the head of Che Lee Yuen in Macau. In 1968, C.C. Tse incorporated Tse Lee Yuen Jewelry Ltd (謝利源金鋪) in Hong Kong although the firm did not open its first store in HK until August 1973, when it opened its flagship store at 364 Nathan Road as shown in above picture and below article featuring designs by Wong Ying (see article).The firm at the time was involved in the gold, silver, jade and diamond jewelry and also sold Chinese antiques and German and Italian jewelry.

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General manager of Chartered Bank and his wife opening Tse Lee Yuen’s new flagship store on Nathan Road in 1973 (KSDN, 1973-08-10)

In the mid-1970s, Tse Lee Yuen took over Perfect Jewellery (仁成珠寶首飾), which was operated by Po Leung Kuk director Lim Yiong-lin on the ground floor of the Prince’s Building.In May 1977, Tse Lee Yuen opened La Mode Jewellery (羅曼首飾) at Ocean Centre in Tsim Sha Tsui, which was the largest jewelry store in the mall at the time featuring modern designs and special lighting by Wong Ying, bringing the total number of stores in HK for Tse Lee Yuen to 3.(KSDN, 1977-5-21)

C.C. Tse had grand ambitions for the firm that went beyond simply a jeweler – he was interested in turning it into a financial giant with jewelry as investments rather than just accessories. In September 1974, Tse Lee Yuen Finance was incorporated and in July 1977, Tse Lee Yuen Insurance Agencies was incorporated in HK. In late 1979, he launched the “3 in 1” scheme where diamonds bought at Tse Lee Yuen were certified and appraised by professionals and insured by New Zealand Insurance.

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C.C. Tse delivering a speech at the 112rd anniversary celebration of Tse Lee Yuen in 1979 (WKYP, 1979-8-9)

In August 1979, Tse Lee Yuen celebrated its 112nd anniversary at the Miramar Hotelas shown in above article during which it played new television commercials promoting the “3 in 1” service and its stores it produced with United Arts Advertising & PR Ltd, Cheung’s Film Production (to be covered) and TVB.In the late 1970s and early 1980s, Tse Lee Yuen advertised heavily in both Chinese and English TV channels,including voiceover by TVB newscaster Warwick Evans in an English ad to promote its “3 in 1” service in 1981.To further highlight how the “3 in 1” program could enhance the value of diamonds, Tse Lee Yuen offered customers a 5% additional rebate when they returned any purchases of diamond over $1000 within 30 days after 6 months of buying it from the firm and received certifications and one year of free insurance in February 1980. (WKYP, 1980-2-23)

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Left: Screenshot from the TV commercial for Tse Lee Yuen Gold Savings plan in 1981; Right: a coin issued by Tse Lee Yuen Hong Kong which highlights its history going back to 1867

In April 1980, Tse Lee Yuen opened its fourth branch on King’s Road in North Point featuring the same old school decor.(WKYP, 1980-4-15)

In June 1980, Tse Lee Yuen launched its “Gold Savings” program at a dinner event at the Sheraton Hotel in Tsim Sha Tsui. At the time, the minimum purchase in the market for gold bullion was five taels which was equivalent to HK$10000-20000 and was beyond the reach of most consumers. Tse Lee Yuen introduced a savings program backed by gold which allowed mom and pop to participate in the gold trade (which was booming as gold price jumped 120% in 1979) for as little as several tens of dollars with deposits and withdrawals recorded by computers. (TKP, 1980-6-13)

In August 1980, Tse Lee Yuen paid $80 million to acquire the property of its Nathan Road flagship store. (WKYP, 1982-9-7) The same month, Tse Lee Yuen opened a branch at Queen’s Road West and the Ocean Centre branch offered free $20 gold and jewelry gift coupon for every purchase over $100 on that day. (WKYP, 1980-8-8)In September 1980, Tse Lee Yuen opened a new branch at Kam Wing Street in San Po Kong to cater to the blue-collar clients in the surrounding areas. The same month, the firm ran a “Buffet Promotion” at its Ocean Centre location where customers who bought over HK$500 worth of jewelry at the “jewelry buffet” at the store received two buffet coupons at the nearby Hong Kong Hotel and over HK$1000 in purchases received four. By 1981, Tse Lee Yuen had 10 stores in HK and opened a branch in Singapore, making it one of the largest jewelry chains in Hong Kong.

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Article and picture of Tse Lee Yuen’s new store in San Po Kong in September 1980 (WKYP, 1980-9-26)

Sales of the group grew to $150 million by 1979-80 and then jumped to $590 million in 1980-81 with profits of $17 million thanks to soaring gold and real estate prices. In August 1981, Tse Lee Yuen acquired a seat at the HK Chinese Gold & Silver Exchange for $1.5 million in order to enter the bullion trading business as the Exchange no longer issue new seats at the time, resulting in the value of seats jumping 25% from the year before. (KSEN, 1981-8-22)By 1982, the group had subsidiaries in garments, real estates, shoes. 50% of jewelry were sourced from Israel and Belgium and 50% locally. As a firm, Tse Lee Yuen Jewellery had authorized capital of $60 million, $55 million of which was paid up. The four-year bull market in gold unfortunately ended in 1981 when gold price corrected 33%.

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Left: headline story of Tse Lee Yuen’s sudden closure in September 1982 and some of its customers outside its stores. (KSDN, 1982-9-7) Right: Hang Lung Bank’s notice in 1982 stating that it had no ties to Tse Lee Yuen and highlighting its financial strength (WKYP, 1982-9-8)

As the HK Credit Bureau later revealed, Tse Lee Yuen’s growth was built heavily on leverage and the firm borrowed $42.2 million from Nanyang Commercial Bank through mortgaging its flagship store on Nathan Road – initially $30 million in July 1980 and an additional $8 million and $4.2 million in July and October 1981. In January 1981, the firm repaid $61 million to Chartered Bank through money raised from its gold savings program. In September 1981, Tse Lee Yuen borrowed $2 million short term loan from a company controlled by Hang Lung Group founder Chan Tseng-hsi and his brother but the Chan brothers sued TseLee Yuen after it was unable to repay the loan in full. (TKP, 1982-9-9)

In August 31, 1982, one of C.C. Tse’s two wives died and within a week in early September 1982, Tse Lee Yuen closed abruptly, leaving over 3500 customers unable to recover their savings. 135 staff claimed HK$965,000 in unpaid wages and severance pay and Nanyang Commercial Bank also filed a writ for HK$53 million in outstanding principal and interests with the High Court appointing a receiver. An elderly woman took her Tse Lee Yuen gold certificate to the Yuen Long branch of Hang Lung Bank (恒隆銀行) demanding cash as she was told that the certificates could be redeemed at any bank. When the cashier declined, a rumor began which resulted in $70 million being withdrawn from Hang Lung Bank by panicked depositors in one day. Hang Lung was able to stop the bank run after running a series of ads highlightingits financial strength and zero ties to Tse Lee Yuen but a year later the bank would collapse due to its ties to another finance company (Dollar Credit) and ultimately triggered a banking crisis that engulfed the HK financial system over the next couple of years. (“Anatomy of a Bank Run”, Business Times, 1982-9-21)C.C. Tse who was in Taiwan at the time of Tse Lee Yuen’s sudden collapse returned to HK and liquidatedthe firm’s inventory to pay off its staff and creditors and as a result, Nanyang dropped its suit. (Straits Times, 1982-9-24) Unfortunately despite his best effort, Tse was unable to pay offthe total claims of HK$131 million and the High Court ordered Tse Lee Yuen to be winded down in January 1983. In December 1983, the receiver managed to pay off $16.4 million that was owed to 10200 creditors including 7724 holders of Tse Lee Yuen gold certificates. (KSDN, 1983-12-22)

After the collapse of Tse Lee Yuen in HK, C.C. Tse started an import export business to deal in arts & crafts which took him to the US, Taiwan, South Korea and Southeast Asia and he moved to small apartment on Hanoi Road in Tsim Sha Tsui. In April 1985, C.C. Tseattempted suicide by swallowing80 sleeping pills and was fortunately discovered in time by a former staff member. (TKP, 1985-4-8)He reconciled with his son Tse Ka-leung (謝嘉亮), a graduate of Leeds University of the UK whom he kicked out of the family business afterhe insisted on marrying the famous singer Stella Chee (奚秀蘭). As a firm, Tse Lee Yuen Jewellery was dissolved in 1997.

From Che Lee Yuen to O’Che 1867 in Macau

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Left: Tse Chi-san at the Che Lee Yuen store in Macau; Right: Tse Ka-leung with Stella Chee

When Tse Lee Yuen collapsed in Hong Kong, Tse Wing-sang of Che Lee Yuen in Macau immediately clarified to the press the lack of connections between the Macau and HK entities. (TKP, 1982-9-7) When he retired in 1984, he was succeeded by his nephew Tse Chi-san, who worked for Che Lee Yuen in Macau during the War.

In 1992, Che Lee Yuen moved from its long time address at Rua Dos Mercadoresto its present address at Rua F.X. Pereira 105A. In 1996, Chi San’s second son, Stephen Tse Yiu-yu (謝耀宇), a fourth-generation member of the family and math graduate of Oxfordjoined the business and the next year, the firm launched its sub-brand –RingMaster (利源軒), a new concept jewelry store to target the younger customers. The deregulation of the Macau casino business brought new life to the retail market in Macau and in 2007, the firm opened a new concept store at the Grand Canal Shoppes at the new Venetian Macao under the “O’Che 1867” brand and afterwards participated in various local and international jewelry shows. In 2012, Tse Chi-san passed away at the age of 88 and was succeeded by his son Stephen. Under Stephen, the chain continued to expand, opening shops at the Harborview Hotel at No. 16-18 Travessa do Mastro and the Lisboa Hotel and the Departure Hall at the Macau International Airport in 2015 and the Sands Cotai Central shopping mall in 2016. In 2018, it opened online shops at T-Mall and JD Mall and offline store at Huafa Mall in Zhuhai, China in 2019.

Sources (other than those cited above):

This article was first posted on 26th July 2021.

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