The First Bank of the United States – First Ever US Bank
After coming into being, United States of America had many financial problems as other countries face during their early stages.
The First Bank of United States was organized by Robert Morris on February 1791 following Hamilton’s wishes and at that time its name was Central Bank.
First US Bank was chartered for 20 years i.e. from 1791 to 1811, its influence stretched and it became most popular among other cities of United States of America too. This was a private bank and helped USA a lot in financing the revolutionary war that did not end until 1783. The theme behind the start of first US Bank was that when the government of the United States was first organized it found that banking institutions were totally lacking in US. Due to weak financial position in the early days of America there was a strong desire that the government should participate actively in restoring business and banking system and organize new banks. At that time central bank was established. This was the First Bank of the United States.
The First Bank of America was headquartered in Philadelphia and had many branches in other cities of USA. This bank played an important role in the commerce of the emerging state. The First Bank of the United States had a capital stock of $10 million, $2 million of which was subscribed by the federal government, while $8 million was subscribed by private individuals. This bank had twenty five directors, five of the 25 directors were appointed by the government, while the remaining directors were chosen by the private investors in the bank.
First US Bank performed the basic banking functions of accepting deposits, issuing bank notes, making loans and purchasing securities. It was a nationwide bank and was in fact the largest corporation in the United States at that time. They bank got reasonable position in USA as a result of its influence in American economy.
The First Bank of the United States solved many of the economic problems of USA at that time. But the main problem was this that it was a private bank and foreign buyers purchased ownership shares of the bank until the 72% of the bank was owned by foreigners. This situation was really great sign of worry for US government and at last government decided renewing the charter.