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The Bank of North America was the first chartered bank in the United States, and served as the country's first de facto central bank. [1] It was chartered by the Congress of the Confederation on May 26, 1781, and opened in Philadelphia on January 7, 1782. [2] [3] [4]
While most countries have only one bank regulator, in the U.S., banking is regulated at both the federal and state levels [5] in an arrangement known as a dual banking system. [6] Depending on its type of charter and organizational structure, a banking organization may be subject to numerous federal and state banking regulations.
The First Bank of the United States was modeled after the Bank of England and differed in many ways from today's central banks. For example, it was partly owned by foreigners, who shared in its profits. Also, it was not solely responsible for the country's supply of bank notes. It was responsible for only 20% of the currency supply; state banks ...
These banks could issue bank notes against specie (gold and silver coins) and the states regulated the reserve requirements, interest rates for loans and deposits, the necessary capital ratio etc. Free banking spread rapidly to other states, and from 1840 to 1863 all banking business was done by state-chartered institutions.
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[5] Numerous banks that were started during this period ultimately proved to be unstable. [6] In many Western states, the banking industry degenerated into "wildcat" banking because of the laxity and abuse of state laws. Bank notes were issued against little or no security, and credit was over extended; depressions brought waves of bank failures.
The bank did not engage in the full range of modern banking activities, but it did accept deposits and provide a potential model for monetary reforms at the national level. [68] The success of the bank provided a boost to Morris's popularity, and in October 1780, he won election to the state legislature. [ 69 ]
Download as PDF; Printable version; In other projects ... 1780s; 1790s; 1800s; 1810s; 1820s; 1830s; Pages in category "Banks established in 1780" The following 4 ...