Which U.S. trust company’s failure intensified the Panic of 1907 after a failed copper-market speculation?

The Knickerbocker Trust Company’s failure intensified the Panic of 1907 after a failed copper-market speculation.

Knickerbocker Trust president Charles T. Barney was associated with financier F. Augustus Heinze, whose attempt to corner the stock of United Copper Company collapsed in October 1907. After the speculation failed, depositors became concerned about Knickerbocker’s connections and rushed to withdraw their money. The trust company suspended operations on 22 October 1907.

The failure helped turn a financial disturbance into a broader banking panic. Other trust companies faced runs, credit tightened, and the New York Stock Exchange suffered heavy losses. Banker J. P. Morgan helped organize emergency support for the financial system. The panic demonstrated that the United States lacked a modern central bank capable of acting as a lender of last resort. Its aftermath contributed to the creation of the Federal Reserve System in 1913.