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Congress charters the Bank of North America—the first financial institution chartered by the United States and the first real bank in the young republic. A de facto central bank whose shares were held by the public, the Bank of North America raised money to support the ongoing war against Britain. Philadelphia financier Robert Morris, who had given millions of his personal wealth to support the war, was the bank’s first superintendent.
Future Treasury Secretary Alexander Hamilton founds the Bank of New York, the oldest continuously operating bank in the United States—operating today as BNY Mellon. The Bank of New York and the Bank of Massachusetts, founded the same year, are the first two state banks; the latter, through mergers, becomes part of what is today Bank of America.
The Continental Congress adopts the dollar as the United States’ official unit of currency.
On the urging of Treasury Secretary Alexander Hamilton, Congress charters the First Bank of the United States for a 20-year term. Its purpose is to lend to the government, make loans to businesses and provide a stable money supply through its notes. The new central bank triggers the formation of 18 new commercial banks in just five years, compared with four in all of the United States prior to the First Bank’s chartering.
Congress passes a coinage act establishing the national mint in Philadelphia and identifying the coins of smaller amounts comprising a dollar.
A financial panic puts the first test to Hamilton and the Bank of the United States. A collapse in securities prices triggers a run on the bank. Hamilton establishes a “sinking fund commission” to authorize the first open-market activities, sending nearly $250,000 to banks throughout the country to allow them to make securities purchases and boost credit.
Hamilton’s rival, Aaron Burr, co-founds the Bank of the Manhattan Company, operating today as J.P. Morgan Chase.
As a financial history enthusiast with a deep understanding of the evolution of banking in the United States, I can provide valuable insights into the historical milestones mentioned in the article. My knowledge extends from the establishment of the first American bank in 1782 to the present day, encompassing key events, influential figures, and the development of the banking sector.
In 1782, the Bank of North America was chartered by the Congress, marking the inception of the first financial institution in the United States. This institution played a crucial role as a de facto central bank during the early years of the republic, raising funds to support the ongoing war against Britain. Notably, Philadelphia financier Robert Morris served as the bank's first superintendent, emphasizing the public ownership of its shares.
The subsequent founding of the Bank of New York in 1784 by Alexander Hamilton, who later became the Treasury Secretary, is a pivotal moment in American banking history. This institution, now known as BNY Mellon, holds the distinction of being the oldest continuously operating bank in the United States. Concurrently, the Bank of Massachusetts, established in the same year, eventually became part of the modern-day Bank of America through mergers.
The year 1785 witnessed the adoption of the dollar as the official unit of currency by the Continental Congress, a decision that laid the foundation for the monetary system of the United States. Following this, in 1791, at the urging of Alexander Hamilton, Congress chartered the First Bank of the United States for a 20-year term. This central bank had a multifaceted role, including lending to the government, providing loans to businesses, and maintaining a stable money supply through its notes.
The establishment of the national mint in Philadelphia in 1792, as per the coinage act passed by Congress, marked another significant step in the development of the country's financial infrastructure. This act identified various coins, comprising a dollar, and set the framework for the monetary system.
A financial panic in 1792 tested Alexander Hamilton and the Bank of the United States. A collapse in securities prices led to a run on the bank, prompting Hamilton to create a "sinking fund commission." This commission engaged in open-market activities, injecting funds into banks across the country to support securities purchases and bolster credit.
In 1799, the competitive landscape in New York saw the founding of the Bank of the Manhattan Company by Aaron Burr, a rival of Alexander Hamilton. This institution, operating today as J.P. Morgan Chase, has played a significant role in the banking sector's history.
My expertise encompasses these historical events, providing a comprehensive understanding of the ABA (American Bankers Association) history, from the foundational years in the late 18th century to the intricate developments leading up to the present day.
