First Bank of the United States

Origins and history

Alexander Hamilton, as first Secretary of the Treasury, sponsored the bank alongside other measures: assumption of state war debts, establishment of a mint, and a federal excise tax. His goals included establishing financial order and credit for the new nation, resolving the Continental currency issue, and raising money for the government. Hamilton proposed initial funding through $10 million in stock, with the U.S. government purchasing the first $2 million using money lent by the bank, repaid in ten equal annual installments.

The remaining $8 million was available to the public, requiring one-quarter of the purchase price in gold or silver. Unlike the Bank of England, the bank's primary function was issuing credit to the government and private interests for economic development. It also served as a depository for taxes, made short-term loans to cover government income gaps, and held incoming and outgoing monies. Non-negotiable conditions accompanied the bank's establishment.

Bank building and branches

The First Bank of the United States first opened its doors inside Carpenters' Hall in 1791, just a short walk from where its own building would later stand. By 1792, it had set up branches in Boston, New York, Charleston, and Baltimore, with additional locations in Norfolk, Savannah, Washington, D.C., and New Orleans opening between 1800 and 1805. Samuel Blodgett is usually named as the architect of the bank’s permanent home, though some point to James Hoban instead.

Finished in 1797, it was the first structure erected specifically for the new federal government. The building became part of Independence National Historical Park when that park was created in 1956, and it was added to the National Register of Historic Places in 1966. It was named a National Historic Landmark in 1987, praised as an early example of monumental Classical Revival architecture. For decades after the 1970s, the building sat closed to visitors, having housed park offices until around 2000.

A $22 million renovation, funded by the Great American Outdoors Act, turned it into a museum focused on the early American economy, which finally opened on July 1, 2026.

Proposal

Hamilton's 1789 plan for the First Bank of the United States proposed raising $10 million through stock sales, with the government buying the first $2 million using money borrowed from the bank, repaid in ten equal annual installments. The remaining $8 million in stock was available to the public, requiring one-quarter of the purchase price in gold or silver and the rest in bonds or scrip. Unlike the Bank of England, the bank's primary role was issuing credit for economic development, while serving as a government depository and lender was secondary.

The bank received a twenty-year charter from 1791 to 1811, with no other federal bank authorized during that period. It could not buy government bonds, had mandatory director rotation, and could not issue notes or debts beyond its capitalization. Foreigners could be stockholders but could not vote. The Secretary of the Treasury could remove deposits, inspect books, and require weekly statements.

To fund interest payments on assumed state debts, Hamilton proposed increasing duties on imported spirits and excise taxes on domestic whiskey, sparking the Whiskey Rebellion.

Presidential approval

George Washington hesitated to sign the bank bill and requested written advice from his cabinet. Attorney General Edmund Randolph and Secretary of State Thomas Jefferson both deemed the bill unconstitutional. Hamilton, from New York, countered that the government could incorporate a business as an artificial person, and that sovereignty inherently included the right to achieve ends not prohibited by the Constitution. Convinced the measure was authorized, Washington signed the bank bill into law on February 25, 1791.

On March 19, 1791, he appointed Thomas Willing, David Rittenhouse, and Samuel Howell as commissioners to take subscriptions. Willing was elected president of the bank on October 25, 1791, serving until his resignation on November 10, 1807. The Philadelphia branch opened on December 12, 1791. David Lenox succeeded Willing and served until the charter expired on March 4, 1811.