Although Banking inAmericahas been taking place since the 17h century, the records indicate that there was no formal American Banking System until the 19th century. Initially there were about 120 private and commercial banks operating in the region which were chartered by the governments of the new states. However their relations and set up were ad hoc in nature and were mainly linked to the merchant practices. An attempt has national banking was made in 1781 which was inaugurated by the act of theUnited Statescongress and the Bank of America inPhiladelphia. This was a central system of banking which operated in a monopoly in the market in terms of currency. The first bank ofAmericawas established in 1791 after receiving a 20 year charter from the Congress. However the state banks in the region were not chartered until in the 1830s. In 1964, the government launched the National Currency Act under which a regulation and monitory body was devised to control the operations in the various banks all overAmerica. The Federal Reserve System was initiated in 1913 through the Federal Reserve Act, which has made the American Banking Sector as it stands today.
The American Banking system composes of a central banking function in which all the banking operations are centralized through the state ofAmerica. On the other hand the system is also providing the sector to indulge in commercial banking as well which is focused towards aiding the businessmen and companies alike in financing and funding projects. This dual nature of the banking system has enabled the American Banking Industry to adapt to the changes in the market brought on by the changes in the consumer perception and the economy.