Central Bank History

The first chartered bank of the United States was the First Bank of the United States, formed in 1791 by The United States Congress.
If you want to visit, it’s located at Third Street, between Chestnut & Walnut Streets in Philadelphia; but it’s not open to the public.
The bank was the brainchild of then-Secretary of the Treasury Alexander Hamilton, who proposed that the bank sell $10M in stock to help establish its initial funding. Of the original $10M, $2M would be purchased by the United States. However, since the newly formed United States didn’t actually have $2M, the bank would loan the government $2M that the government would pay back in ten annual installments.
The creation of the bank was lumped in with an increase in excise taxes on liquor and the minting of paper currency. In order to push the bill through opposition to the excise taxes from southern members of Congress, Hamilton brokered a deal to support a bill that would move the capital from Philadelphia to what later would become Washington, D.C.
The First Bank of the United States was not the first chartered bank in the territory that is now the United States, that distinction belongs to the Bank of North America. That bank was chartered on the last day in 1781 by the Congress of the Confederation.
The Bank of North America would be succeeded by the First Bank of the United States.
The Bank of North America, with national bank charter #1, still exists today and is held by Wachovia, N.A. Wachovia still operates a branch at the northwest corner of 6th and Chestnut in Philly, the site of the original bank.
As you may have expected, that Wachovia branch is the longest continuously operating branch bank in the US, having been there since 1781.
The Second Bank of the United States was chartered 5 years after the charter for the First Bank of the United States expired and the Second Bank was again located in Philadephia.
Why a Second bank if the government allowed the charter for the First Bank to expire? War! The US found itself unable to finance the War of 1812 and thus chartered a Second Bank of the United States.
There was quite a bit of controversy around the bank, there’s plenty of resources out there to read about it if you’re interested so I’ll skip it here, but eventually it went bankruptcy five years after the expiration of its charter in 1836.
If you want to visit, it’s located on Chestnut Street between 4th and 5th Streets and it’s open to the public free of charge( National Parks Service info page).
There was no Third Bank of the United States, or any central bank, for 80 years following the expiration of the Second Bank’s charter. That’s when the Aldrich plan, named after Republican Senator Nelson W. Aldrich of Rhode Island, of fifteen regional central banks was floated and discussed.
Eventually, the Federal Reserve Act of 1913 instituted 12 Federal Reserve banks, headed by a seven member Federal Reserve board plus a single US currency, a Federal Reserve Note.
The twelve Federal Reserve banks are located in Boston , New York Philadephia Cleveland Richmond Atlanta Chicago St. Louis Minneapolis Kansas City Dallas and San Francisco
All nationally chartered banks are required to become members of the Federal Reserve System, which means they must buy non-transferable stock in their regional Federal Reserve bank.
In the 1930’s, the Federal Reserve Act was amended to include the Federal Open Market Committee that consisted of the seven members of the Board of Governors of the Federal Reserve System and five representatives from the regional Federal Reserve banks.