Banking Practice Showdown 2025 – Vault into Your Future Success!

National and state charters are typically issued to financial institutions that are engaged in the activities of accepting deposits and making loans, such as credit unions, commercial banks, and savings associations. These institutions can choose to operate under either a national charter, which places them under federal regulation, or a state charter, which allows for state oversight.

Federal Reserve banks, however, are different from the institutions mentioned above. They do not operate under a national or state charter in the same manner. Instead, Federal Reserve banks are part of the Federal Reserve System, which serves as the central banking system of the United States. This system was established by federal law and primarily functions to manage monetary policy, oversee the banking system, and provide financial services, rather than to offer the traditional banking services that require charters.

Thus, since Federal Reserve banks do not require national or state charters like credit unions, commercial banks, or savings associations, this option stands out as the correct response to the question.