The Arendal crash (''Arendalskrakket'') was an economic crisis in Arendal,

Norway Norway, officially the Kingdom of Norway, is a Nordic country in Northern Europe, the mainland territory of which comprises the western and northernmost portion of the Scandinavian Peninsula. The remote Arctic island of Jan Mayen and the ...

, that occurred when the bank Arendals Privatbank went bankrupt in 1886 and the bank's co-owner

Axel Nicolai Herlofson Axel Nicolai Herlofson (29 August 1845 in Østre Moland – 1910 in Christiania) was a Norwegian fraudster who is known for causing the Arendal crash, after defrauding customers and co-owners of Arendals Privatbank which he had co-founded ...

was revealed to have defrauded customers and co-owners systemically. The crash led to several other bankruptcies and

unemployment Unemployment, according to the OECD (Organisation for Economic Co-operation and Development), is people above a specified age (usually 15) not being in paid employment or self-employment but currently available for work during the refere ...

Southern Norway Southern Norway ( no, Sørlandet; lit. "The Southland") is the geographical region (''landsdel'') along the Skagerrak coast of southern Norway. The region is an informal description since it does not have any governmental function. It rough ...

, and marked the end of Arendal as an important shipping town. It took over 80 years to overcome the effects of the crash. Herlofson was sentenced to six years penal labour. Only two years after its start in 1874, the bank was in reality bankrupt, but the bank was continued for nine years due to corruption and poor routines or a lack of routines. The debt to Herlofson, his brother Oskar and Strømsbu sag was finally NOK 12 million, corresponding to the entire wealth of Kristiansand's population, or six billion 2012 kroner.Agderposten – Hadde hatt 6 milliarder i gjeld
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References

Literature

*Johannes G. Torstveit: ''Storsvindel bankkrakk og nytt politisk parti 1886-88, Arendal 1886-1888'', Arendals Tidende, 2012 *: ''Av en ældre Arendalsmands erindringer fra de sidste 50 aar (1870–1920). I Arendal fra fortid til nutid''. Utgitt ved byens 200-års jubileum som kjøpestad 7. mai 1923 {{Financial crises Financial crises Arendal