The National Banking System: A Brief History

36 Pages Posted: 23 Jul 2008

See all articles by Bruce A. Champ

Bruce A. Champ

Federal Reserve Bank of Cleveland

Date Written: December 1, 2007


During the period of the National Banking System (1863-1913), national banks could issue bank notes backed by holdings of eligible U.S. government securities. This paper presents an overview of the legal and financial history of this period. It begins with the reasons the National Banking System was created. It also examines the rules of operation for national banks as established by the National Banking Act and its subsequent revisions. Furthermore, the paper serves as a brief financial history of the period, examining the various forces that shaped the environment in which national banks operated. This paper represents a preliminary chapter from a forthcoming monograph on the period of the National Banking System. Other chapters of the monograph will appear in the Federal Reserve Bank of Cleveland's working paper series.

Keywords: bank notes, National Banking System, national banks, banking panics

JEL Classification: E42, E43, G21, N21

Suggested Citation

Champ, Bruce A., The National Banking System: A Brief History (December 1, 2007). FRB of Cleveland Working Paper No. 07-23, Available at SSRN: or

Bruce A. Champ (Contact Author)

Federal Reserve Bank of Cleveland ( email )

PO Box 6387
Cleveland, OH 44101-1387
United States

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