Pet banks
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Pet banks is a term applied to the state banks selected by the U.S. Department of Treasury to receive government deposits in 1833, following the collapse of the Second Bank of the United States by President Andrew Jackson. In 1836 there were 89 pet banks. The term was so-applied because most of the banks were chosen not because of monetary fitness but on the basis of the spoils system, which rewarded political allies of Andrew Jackson. Constituted the Independent Treasury.
Most Pet Banks of them eventually lost a lot of money and failed. This assisted in bringing on the Panic of 1837 where there was a major dip in the economy due to the increased debt created by this banking system.
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