Which institution is the United States’ central banking system, created by Congress in 1913?

The Federal Reserve System is the United States’ central banking system, created by Congress in 1913.

President Woodrow Wilson signed the Federal Reserve Act on December 23, 1913. The legislation followed repeated American banking panics, especially the Panic of 1907, which exposed the need for a lender of last resort and a more flexible supply of currency. The new system began operations in 1914.

The Federal Reserve has a distinctive structure. It includes a seven-member Board of Governors in Washington, D.C., twelve regional Federal Reserve Banks, and the Federal Open Market Committee. Its responsibilities include monetary policy, supervision of some financial institutions, payment-system services, and broader financial stability.

The Federal Reserve is not the same thing as the U.S. Treasury. The Treasury manages federal government finances and debt, while the Fed conducts monetary policy and supports the banking system. The system’s central governing body is the Board of Governors, but the regional reserve banks are important parts of the overall institution.