Which U.S. financial institution’s 1907 collapse intensified the Panic of 1907?

The Knickerbocker Trust Company’s collapse intensified the Panic of 1907.

The New York trust company suspended operations on October 22, 1907, after a failed attempt to corner the stock of United Copper. Depositors rushed to withdraw funds, and fear spread to other banks and trusts. Because the United States had no modern central bank at the time, private financiers played a major role in containing the emergency.

Banker J. P. Morgan organized support for threatened institutions and helped stabilize the banking system. The episode convinced many policymakers that the country needed a lender of last resort.

The Federal Reserve System was created in 1913, although the Panic of 1907 was not its sole cause. The Knickerbocker Trust Company should not be confused with the later Knickerbocker Bank of New York.