Changes in Banks in the U.S
1791 Bank of the U.S
The Bank of the United States received a charter in 1791 from Congress that was then signed by George Washington. This bank collected fees and made payments on behalf of the federal government. This bank eventually went away because state banks opposed it for the main reasoning of it giving too much power to the national government.
1816 Second Bank of the U.S
The second bank of the United States was chartered in 1816 and later failed because it did not regulate state banks or charter any other bank. In effect, state banks were issuing their own form of currency.
Civil War (printing money)
Greenbacks were paper currency issued by the United States during the American Civil War. This was the first time the federal government printed paper currency.
1863 National Banking Act
This stated that Banks could have a state or federal charter (dual banking.)
1913 Federal Reserve Act
This was based after the National Banking Act and established the central banking system for the United States.
1930's Great Depression (regarding banking)
The Great Depression is the effect of having the banks collapse. FDR declared a "Bank Holiday" where banks closed and they were only allowed to reopen if they could prove they were financially stable.
1933 Glass-Steagall banking Act
This Act established the federal deposit insurance corporation which ensures that if a bank goes under you won't lose the money you've put into the bank.
1970's (regarding banking)
Congress finally relaxed restrictions on the banks, there was deregulation among the government and banks.
1982 (regarding banking)
Congress then allows S&L banks to make high risk loans and investments. The investments then went bad and banks failed. The Federal government had to give investors their money back and the debt was up to $200 billion. The FDIC then took over the S&L.
1999 Gramm-Leach-Bliley Act
This allows banks to have more control over banking, insurance and security. The cons to this are less competition, may form a universal bank; and may lead to the sharing of more information because of the reduction of privacy.