Democratic-Republican leaders felt that Hamilton's bank would have too much power, and would cause a banking monopoly. Jefferson and his political allies held that the bank was unconstitutional (illegal under the Constitution), since the Constitution did not specifically give the government power to charter banks. Hamilton countered that the bank was constitutional, since Congress had the right to coin money and regulate money's value, regulate trade, levy and collect taxes, and borrow money. He asserted that the establishment of a national bank was "necessary and proper" to aid the government in performing these other financial duties. Since Congress was controlled by people who shared Hamilton's views, it passed the bill on February 8, 1791. According to the Constitution, however, the president has to sign any bill passed by Congress before it becomes law. When Congress gave the bill to President George Washington to sign, Washington was not sure what to do. Like Jefferson, he was concerned about the constitutionality of the Bank. Washington decided to look at both sides of the issue. He asked three people to write what they thought about the constitutionality of the Bank: Alexander Hamilton, Thomas Jefferson, and Edmund Randolph. As expected, Hamilton wrote in favor of the Bank, Jefferson wrote against the Bank. Randolph wrote two essays, one against the Bank, and one which did not take a clear position one way or the other.
Washington found Hamilton's arguments most compelling, so he signed the bill into law on February 25, 1791. The new law chartered the First National Bank of the United States for 20 years. It had its headquarters in Philadelphia and branches throughout the country. The bank was privately owned and managed, with the government holding one fifth of the stock. Although it had a capital of $10 million, about three-fourths of the private subscription ($8 million) was payable in government bonds, and only one fourth required in specie.