Skip to main content
OCC Flag

An official website of the United States government

Anatomy of a Banknote

The designers of the national currency had several goals:

  • attracting converts to, and building confidence in, the new banking system and money supply,
  • promoting patriotism and civic awareness,
  • preventing counterfeiting,
  • stimulating the sale of U.S. government bonds,
  • and striking a balance between local autonomy and federal authority.

Explore the anatomy of the historic $10 and $1 banknotes below:

Image of a $10 note front of the bill issued by the National Bank of Commerce in St. Louis, 1889.
A $10 note issued by the National Bank of Commerce in St. Louis, 1889.
✕
  • Image A

    National banks were required to purchase U.S. bonds or other investment-grade securities in an amount equal to 90 percent of the face value of a bank’s notes.

    These securities were placed on deposit with the OCC. If a national bank could not meet its redemption requirements, the OCC could sell the bonds and distribute the proceeds to noteholders.

  • Image B
    National banks were attracted by the prestige of having their name (and charter number) inscribed on the notes they issued.
  • Image C
    To make banknotes legally binding instruments, the National Bank Act required that each one issued by a national bank be signed by its officers.
  • Image D
    National banks were required to hold reserves of precious metal, to be paid “on demand” when notes were presented to them.

 

Image of a $10 note back of the bill issued by the National Bank of Commerce in St. Louis, 1889.
A $1 note issued by the Marine National Bank of New York, 1865.
✕
  • Image E

    To promote historical awareness and patriotism, national currency depicted iconic scenes from the nation’s past. Here, the Pilgrims land at Plymouth Rock.

  • Image F
    To foil counterfeiters, national banknotes were intentionally detailed and ornate. In addition, several denominations of national currency contained lengthy extracts from the law that assigned penalties for counterfeiting.
  • Image G
    The essence of the national banking system was that locally owned and managed institutions would operate under federal authority and supervision. This note from a New York national bank, showing the state seal on one side and the American bald eagle on the other, communicated that concept.