“Unless the corrupting monster should be shraven with its ill gotten power, my veto will meet it frankly & fearlessly.”

President Andrew Jackson to John Coffee,
February 19, 1832

Congress established the First Bank of the United States in 1791 to serve as a repository for Federal funds. Its charter expired in 1811, but in 1816 Congress created a Second Bank of the United States with a charter set to expire in 1836. By the 1830s the Bank had become a volatile political issue. Some, especially in the trans-Appalachian West, were suspicious of banks because they distrusted the paper money issued by them and because banks controlled credit and loans. To them, the Bank of the United States was the worst of them all: a greedy monopoly dominated by the rich American and foreign interests.

The Bank’s most powerful enemy was President Andrew Jackson. In 1832 Senator Henry Clay, Jackson’s opponent in the Presidential election of that year, proposed rechartering the Bank early. This bill passed Congress, but Jackson vetoed it, declaring that the Bank was "unauthorized by the Constitution, subversive to the rights of States, and dangerous to the liberties of the people." After his reelection, Jackson announced that the Government would no longer deposit Federal funds with the Bank and would place them in state banks. Supporters of the Bank in the Senate were furious and took the unprecedented step of censuring Jackson. The President held fast, however, and when the Bank’s charter expired in 1836, it was never renewed.