Background

From 1863 to 1935, National Bank Notes were issued by banks throughout the country and in U.S. territories. The chartering of banks and administrative control over the issuance of National Bank Notes were the responsibility of the Office of the Comptroller of the Currency.

The Program

The U.S. Government decided that they could help local banks by creating a new system for banks to issue notes. Banks with a federal charter would deposit bonds in the U.S. Treasury. The banks then could print banknotes worth up to 90% of the value of the bonds. The federal government would back the value of the notes.

The Notes

National banknotes were similar in overall appearance to most of the Federal Reserve Notes that circulated from 1929 through the 1990s, with one important exception: the "title" (name) of the issuing "national bank", as well as the name of the town and state where the bank was located were printed on the notes. These notes also bore the signatures of that bank's president and cashier.

End of the Program

National bank notes were retired as a currency type by the U.S. government in the 1930s during the great depression. This was because many local banks went out of business because people felt their money was no longer safe with banks.

Sometimes these notes are called "hometown" notes, with their popularity deriving from the wide range of towns and cities that issued them. In the paper money hobby, especially in the U.S., these notes are avidly studied and collected. Some examples of rare banks, towns, states and combinations thereof are quite valuable.