Knickerbocker Trust Company
The Knickerbocker Trust Company was a bank in the United States that existed from 1884 to 1912. It was founded by Frederick G. Eldridge, a friend and classmate of John Pierpont Morgan . The Knickerbocker Trust Company was one of the banks with the highest deposits in its time and was largely responsible for the outbreak of the panic of 1907 .
1907 crisis and further history
On October 10, 1907, Charles T. Barney, the company's director, met with Charles W. Morse, Fritz Augustus Heinze, and Otto Heinze at the Barney home on Fifth Avenue . Morse planned to take over the shares of the United Copper Company together with the Heinzes and stated that he thought it would take 1.5 to 3 million dollars to do so. The Knickerbocker Trust Company approved the loan for it. That takeover failed and Barney was advised to step down as director. On October 21, 1907, the National Bank of Commerce announced that it would no longer accept changes to the Knickerbocker Trust Company , which motivated the Knickerbocker Trust Company's investors to want to withdraw their deposits. Barney went to see John Pierpont Morgan, but the latter refused to see him. Barney shot himself on November 14, 1907. The banking system suffered a loss of confidence and the Dow Jones Industrial Average fell 48 percent from January to November 1907. To instill trust, Congress created the Federal Reserve System by law in 1913 .
A few weeks after the forced shutdown, the Knickerbocker Trust Company paid out all investors including interest. In 1912 its liabilities were acquired by the Columbia Trust Company and the Columbia-Knickerbocker Trust Company was formed. This company was taken over by the Irving Trust Corporation in 1923 , which was taken over by the Bank of New York in 1989 .
building
The bank's headquarters were at 66 Broadway , with branches in Harlem and the Bronx . The Trust had a branch in a Roman-style temple designed by McKim, Mead, and White on the northwest side of 34th Street and Fifth Avenue , which was built from 1902 to 1904 opposite the Waldorf-Astoria . Stanford White's design allowed the building to be added nine more stories. In 1958 the emphasis on the pilasters was removed from the facade.
Web links
Individual evidence
- ↑ New York Times , May 8, 1888, ASSAULTED BY A WAITER .; A NARROW ESCAPE FOR FREDERICK G. ELDRIDGE . pdf
- ^ The New York Times , July 25, 1889, FUNERAL OF FG ELDRIDGE . pdf
- ^ Robert F. Bruner, Sean D. Carr, The Panic of 1907: lessons learned from the market's perfect storm , John Wiley and Sons, 2007, 258 pp., 45
- ^ The New York Times , October 22, 1907, OTTO HEINZE & CO. IN BANKRUPTS 'COURT . pdf
- ^ The New York Times , April 29, 1910, WISE GETS FIGURES ON THE HEINZE LOANS; With $ 79,765 Balance Otto Heinze & Co. Borrowed $ 636,000 on Copper and Ice Stock . pdf
- ↑ Until 1906 trusts , unlike banks, did not have to deposit any minimum reserves . From 1906 they had to deposit 15% of the deposits as a minimum reserve, of which a third had to be held in cash. Brunner S. 67 Trusts were less regulated, but were not secured by a clearinghouse system like banks. In New York there was the New York Clearing House for banks and the Knickerbocker Trust Company, clearing was done by the National Bank of Commerce .
- ^ The New York Times , October 27, 1907, THE KNICKERBOCKER CHECK EXPLAINED; Sent by Trust Company of America to Withdraw Its $ 960,000 Balance . pdf
- ^ Brunner p. IX
- ^ Banking In The United States www.banking.state.pa.us - Pennsylvania's Department of Banking