Franklin D. Roosevelt signed the Banking Act of 1933 during the banking crisis surrounding the 1929 stock-market crash.
The law became effective after Roosevelt took office during the Great Depression. It created the Federal Deposit Insurance Corporation, or FDIC, which began insuring eligible bank deposits and was designed to restore public confidence in the banking system.
The Banking Act also separated commercial banking from investment banking through the provisions commonly associated with Glass–Steagall. The separation reflected concern that certain banking activities had increased financial risk, although historians debate how directly those activities caused the stock-market collapse.
The law followed the nationwide bank holiday declared in March 1933, when Roosevelt temporarily closed banks for inspection. It is important not to confuse the act with the Securities Act of 1933, which focused mainly on disclosure and regulation of securities offerings rather than deposit insurance.