The Bank of Upper Canada was established in 1821 under a charter granted by the legislature of Upper Canada in 1819 to a group of Kingston merchants. The charter was appropriated by the more influential Executive Councillors to the Lt. Governor, the Rev. John Strachan and William Allan, and moved to Toronto. The bank was closely associated with the group that came to be known as the Family Compact, and it formed a large part of their wealth. The association with the Family Compact and its underhanded practices made Reformers, including Mackenzie, regard the Bank of Upper Canada as a prop of the government. Complaints about the bank were a staple of Reform agitation in the 1830s because of its monopoly and aggressive legal actions against debtors.

The Province of Upper Canada was a part of British Canada established in 1791 by the Kingdom of Great Britain, to govern the central third of the lands in British North America, formerly part of the Province of Quebec since 1763. Upper Canada included all of modern-day Southern Ontario and all those areas of Northern Ontario in the Pays d'en Haut which had formed part of New France, essentially the watersheds of the Ottawa River or Lakes Huron and Superior, excluding any lands within the watershed of Hudson Bay. The "upper" prefix in the name reflects its geographic position along the Great Lakes, mostly above the headwaters of the Saint Lawrence River, contrasted with Lower Canada to the northeast.