The First Bank of the United States was a federally chartered financial institution established by an Act of Congress and signed into law by President George Washington on 25 February 1791. Proposed by Secretary of the Treasury Alexander Hamilton as part of his broader financial program, the bank was designed to stabilize the young nation's currency, manage public debt, and provide a depository for federal revenues. It operated from 1791 until its charter expired in 1811, when Congress declined to renew it. The bank was headquartered in Philadelphia, Pennsylvania, then the national capital, and maintained branch offices in several major cities.

Hamilton submitted his proposal for a national bank to Congress in December 1790 as part of a three-part financial program that also included federal assumption of state war debts and the establishment of a national mint. The bank was modeled in part on the Bank of England. It was capitalized at $10 million - an enormous sum for the era - with the federal government holding $2 million in shares and private investors holding the remainder. Its notes were accepted as legal tender for payments to the federal government, giving them practical currency throughout the country.

The bank's constitutionality was disputed from the outset. Secretary of State Thomas Jefferson and Attorney General Edmund Randolph advised Washington that Congress lacked authority under the Constitution to charter a bank, as no such power was explicitly enumerated. Hamilton countered with a broad reading of the Necessary and Proper Clause, arguing that a bank was a legitimate instrument for carrying out enumerated powers such as collecting taxes, regulating commerce, and borrowing money. Washington accepted Hamilton's reasoning and signed the bill. This dispute established one of the earliest and most consequential precedents in American constitutional interpretation. See the Debate page for the constitutional arguments in full.

The bank issued its first notes and began operations in December 1791. It functioned as a fiscal agent for the Treasury, collected and disbursed government funds, and extended credit to both the government and private borrowers. Its notes circulated widely and helped address the chronic shortage of reliable currency that had plagued commerce under the Articles of Confederation.

The bank's twenty-year charter came up for renewal in 1811. Opposition from agrarian and states'-rights factions, combined with suspicion of the concentration of financial power and the fact that a majority of the bank's private shares were by then held by foreign investors, led the Senate to deadlock on renewal, with Vice President George Clinton casting the tie-breaking vote against recharter. The bank formally closed in 1811.

The financial difficulties the federal government encountered during the War of 1812 - including an inability to manage debt or stabilize currency without a central institution - contributed to a reversal of sentiment. Congress chartered the Second Bank of the United States in 1816. The First Bank's Philadelphia headquarters, completed in 1797, survives as a National Historic Landmark. The question of whether a national bank serves or threatens republican government remained a defining axis of American political debate well into the nineteenth century. See the History page for a fuller account of the bank's founding, operations, and dissolution.

There is broad scholarly consensus among economic historians that the First Bank performed its core fiscal functions effectively and contributed to monetary stability during its operation. The normative questions - whether such an institution was constitutionally sound, economically desirable, or compatible with republican self-government - remain subjects of historical and political debate.

• Hamiltonian Nationalist Viewpoint - The bank was a necessary instrument of national economic development, constitutional under a broad reading of federal power, and essential to creditworthiness and commercial stability.

• Jeffersonian Republican Viewpoint - The bank exceeded constitutional authority, concentrated financial power in ways incompatible with republican government, and favored commercial and creditor interests over agrarian and debtor ones.

• States' Rights Viewpoint - Federal chartering of a bank encroached on powers reserved to the states, set a dangerous precedent for expansive federal authority, and undermined the balance of the federal system.

• Hard Money Viewpoint - Bank-issued paper notes and fractional reserve lending were inherently inflationary and prone to instability, regardless of whether the issuing institution was public or private.

• First Bank of the United States - History
• First Bank of the United States - Debate
• First Bank of the United States - Economic History Consensus
• Second Bank of the United States
• Hamilton's Financial Program
• Necessary and Proper Clause
• McCulloch v. Maryland
• Bank War

1. Act of February 25, 1791, ch. 10, 1 Stat. 191 (chartering the First Bank of the United States).
2. Alexander Hamilton, “Opinion on the Constitutionality of a National Bank,” 23 February 1791, in The Papers of Alexander Hamilton, ed. Harold C. Syrett, vol. 8 (New York: Columbia University Press, 1965).
3. Thomas Jefferson, “Opinion on the Constitutionality of a National Bank,” 15 February 1791, in The Papers of Thomas Jefferson, ed. Julian P. Boyd, vol. 19 (Princeton: Princeton University Press, 1974).
4. Bray Hammond, Banks and Politics in America from the Revolution to the Civil War (Princeton: Princeton University Press, 1957), pp. 114-143.
5. David Jack Cowen, The Origins and Economic Impact of the First Bank of the United States, 1791-1797 (New York: Garland, 2000).
6. “First Bank of the United States,” National Historic Landmarks Program, National Park Service, U.S. Department of the Interior.