What trust collapse helped trigger the Panic of 1907 in the United States?

The collapse of Knickerbocker Trust helped trigger the Panic of 1907 in the United States.

Knickerbocker Trust, then one of New York City's largest trust companies, became associated with a failed attempt to corner the stock of United Copper Company. When the scheme collapsed in October 1907, depositors withdrew funds from the trust, producing a bank run.

The crisis spread because trust companies held substantial deposits but faced fewer reserve requirements than commercial banks. J. P. Morgan organized emergency support from bankers and helped prevent a broader collapse of the financial system.

The Panic of 1907 exposed weaknesses in the U.S. banking system. It became an important background event in the creation of the Federal Reserve System in 1913. Knickerbocker Trust is sometimes described as the sole cause, but the panic also reflected tight credit and fragile confidence.