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The Knickerbocker Trust was a bank based in
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that was, at one time, among the largest
bank A bank is a financial institution that accepts Deposit account, deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital m ...
s in the
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. It was a central player in the
Panic of 1907 The Panic of 1907, also known as the 1907 Bankers' Panic or Knickerbocker Crisis, was a financial crisis that took place in the United States over a three-week period starting in mid-October, when the New York Stock Exchange fell almost 50% fro ...
.


History

The bank was chartered in 1884 by
Frederick G. Eldridge Frederick Gideon Eldridge (May 24, 1837 – July 22, 1889) was president of the Knickerbocker Trust Company in 1884. Biography He was born on May 24, 1837, in Marblehead, Massachusetts. He married Alice Lee Goodrich in 1859. He became presiden ...
, a friend and classmate of financier
J.P. Morgan JP may refer to: Arts and media * ''JP'' (album), 2001, by American singer Jesse Powell * ''Jp'' (magazine), an American Jeep magazine * ''Jönköpings-Posten'', a Swedish newspaper * Judas Priest, an English heavy metal band * ''Jurassic Par ...
. As a
trust company A trust company is a corporation that acts as a fiduciary, trustee or agent of trusts and agencies. A professional trust company may be independently owned or owned by, for example, a bank or a law firm, and which specializes in being a trust ...
, its main business was serving as trustee for individuals, corporations and estates. Eldridge was the founding president serving until his death in 1889. Eldridge was succeeded John P. Townsend, who served as president for five years until he resigned to become president of the Bowery Savings Bank. After Townsend's resignation, Robert Maclay was unanimously chosen to be the new president, with Charles Tracy Barney as vice president. When Maclay retired in 1897, Barney was elected president.


Panic of 1907

In 1907, its funds were being used by then-president
Charles T. Barney Charles Tracy Barney (January 27, 1851 – November 14, 1907) was the president of the Knickerbocker Trust Company, the collapse of which shortly before Barney's death sparked the Panic of 1907. Early life Charles T. Barney was born on January 27 ...
in a plan to drive up the cost of
copper Copper is a chemical element with the symbol Cu (from la, cuprum) and atomic number 29. It is a soft, malleable, and ductile metal with very high thermal and electrical conductivity. A freshly exposed surface of pure copper has a pink ...
by
cornering the market In finance, cornering the market consists of obtaining sufficient control of a particular stock, commodity, or other asset in an attempt to manipulate the market price. One definition of cornering a market is "having the greatest market share in ...
. This gamble came undone due to the dumping of millions of dollars in copper into the market to stop a hostile takeover in an unrelated organization. Barney requested a meeting with J.P. Morgan to discuss financial assistance for the bank, but was rejected. The board of Knickerbocker Trust asked Barney to resign after he admitted involvement in the Morse speculations. That afternoon, the National Bank of Commerce announced it would no longer clear checks for the Knickerbocker, triggering a
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of depositors demanding their funds back that forced the Knickerbocker to suspend operations. George L. Rives, Henry C. Ide and Ernst Thalmann were named receivers. The failure of the Knickerbocker was the impetus for the
Panic of 1907 The Panic of 1907, also known as the 1907 Bankers' Panic or Knickerbocker Crisis, was a financial crisis that took place in the United States over a three-week period starting in mid-October, when the New York Stock Exchange fell almost 50% fro ...
, and exacerbated an ongoing decline in the stock market that saw the
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lose 48% of its value from January 1906 to November 1907. The banking crisis is also seen as the final event that led
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to form the
Federal Reserve System The Federal Reserve System (often shortened to the Federal Reserve, or simply the Fed) is the central banking system of the United States of America. It was created on December 23, 1913, with the enactment of the Federal Reserve Act, after ...
in 1913.Edward Ten Broeck Perine. (1916), ''The Story of the Trust Companies''. A. Foster Higgins of
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, served as successor president of Knickerbocker (Barney shot himself on November 14, 1907). Higgins was 77 years old and quite garrulous. Foster made public statements, including one following the death of Barney, that greatly embarrassed the Rehabilitation Committee under F.G. Bourne and William A. Tucker that was trying to get the trust company on its feet again. Nevertheless, the company reopened some weeks after its forced closing and paid off all depositors in full with interest. John Steele Gordon. (1999), '' The Great Game: The Emergence of Wall Street as a World Power: 1653–2000''. In March 1908,
Charles H. Keep Charles Hallam Keep (1861 – August 30, 1941) was an American banker who served as Assistant Secretary of the Treasury from 1903 to 1907 where he was chairman of the Keep Commission and later served as president of the Knickerbocker Trust. Early ...
became president of the Knickerbocker Trust. He had previously served as
Assistant Secretary of the Treasury A United States Assistant Secretary of the Treasury is one of several positions in the United States Department of the Treasury, serving under the United States Secretary of the Treasury. History According to U.S. statute, there are eight Assista ...
from 1903 to 1907 under Secretary
L. M. Shaw Leslie Mortier Shaw (November 2, 1848March 28, 1932) was an American businessman, lawyer, and politician. He served as the 17th Governor of Iowa and was a Republican candidate in the 1908 United States presidential election. Biography Shaw was b ...
during President
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's administration followed by his appointment as New York State Superintendent of Banks. He served in that role for less than a year until he was appointed to the
New York Public Service Commission The New York Public Service Commission is the public utilities commission of the New York state government that regulates and oversees the electric, gas, water, and telecommunication industries in New York as part of the Department of Public Servi ...
, from which he resigned in 1908 to become president of the Knickerbocker.


Mergers and acquisitions

In February 1903, Knickerbocker Trust acquired the Washington Bank, afterwards opening a branch in the seven-story Smith Building at 148th Street and Third Avenue in the Bronx Financial District. In November 1912, the company bought its Bronx branch building, which was considered the Bronx's first skyscraper when it was built in 1900. In 1912, its assets were acquired by the Columbia Trust Company, forming the Columbia-Knickerbocker Trust Company. One of the principal shareholders of the Columbia was Hetty Green and her son, Ned Green, was a director. At the time, Columbia had deposits of more than $21,000,000 and Knickerbocker had deposits of approximately $38,000,000. Columbia's president,
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, served as president of the new company and Knickerbocker's president,
Charles H. Keep Charles Hallam Keep (1861 – August 30, 1941) was an American banker who served as Assistant Secretary of the Treasury from 1903 to 1907 where he was chairman of the Keep Commission and later served as president of the Knickerbocker Trust. Early ...
, became chairman of the board. It was said that one of the deciding factors with the Columbia interests was Knickerbocker's hold on the uptown field. Columbia Trust had no branches and had outgrown its headquarters at 135 Broadway. In 1914, the name was changed back to Columbia Trust Company before it was acquired by merger by the Irving Bank of New York (which had been founded in New York in 1851) in February 1923. After the merger, it was called the Irving Bank-Columbia Trust Company. In September 1926, the company was renamed Irving Bank and Trust Company before it acquired the American Exchange-Pacific Bank after which it was renamed the American Exchange Irving Trust Company. In 1929, the name was changed again to the Irving Trust Company. On October 7, 1988, the Irving Trust board signed an agreement to merge with
Bank of New York The Bank of New York Mellon Corporation, commonly known as BNY Mellon, is an American investment banking services holding company headquartered in New York City. BNY Mellon was formed from the merger of The Bank of New York and the Mellon Finan ...
ending a yearlong battle as Bank of New York engineered a
hostile takeover In business, a takeover is the purchase of one company (the ''target'') by another (the ''acquirer'' or ''bidder''). In the UK, the term refers to the acquisition of a public company whose shares are listed on a stock exchange, in contrast to t ...
. At the time of the merger the combined banks became the
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' 12th largest bank with asset of $42 billion. During that year Irving had been trying to participate in a friendly merger with
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.


Knickerbocker Trust Building

The
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bank was housed in a Roman-style temple designed by
McKim, Mead, and White McKim, Mead & White was an American architectural firm that came to define architectural practice, urbanism, and the ideals of the American Renaissance in fin de siècle New York. The firm's founding partners Charles Follen McKim (1847–1909), W ...
and erected between 1902 and 1904 (''illustrated'') at the northwest corner of 34th Street and Fifth Avenue.
Stanford White Stanford White (November 9, 1853 – June 25, 1906) was an American architect. He was also a partner in the architectural firm McKim, Mead & White, one of the most significant Beaux-Arts firms. He designed many houses for the rich, in addition ...
's design allowed for the possibility of adding nine stories of offices upon the structure. It had branch offices at 60 Broadway, in
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and
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. The Stanford White building was enlarged by ten stories in 1921, and the
façade A façade () (also written facade) is generally the front part or exterior of a building. It is a loan word from the French (), which means ' frontage' or ' face'. In architecture, the façade of a building is often the most important aspect ...
completely redesigned in 1958, with its signature
pilaster In classical architecture, a pilaster is an architectural element used to give the appearance of a supporting column and to articulate an extent of wall, with only an ornamental function. It consists of a flat surface raised from the main wal ...
s covered over; it still remains, its original form unrecognizable.


Presidents of Knickerbocker Trust

* 1884–1889:
Frederick G. Eldridge Frederick Gideon Eldridge (May 24, 1837 – July 22, 1889) was president of the Knickerbocker Trust Company in 1884. Biography He was born on May 24, 1837, in Marblehead, Massachusetts. He married Alice Lee Goodrich in 1859. He became presiden ...
* 1889–1894: John P. Townsend * 1894–1897: Robert Maclay * 1897–1907:
Charles T. Barney Charles Tracy Barney (January 27, 1851 – November 14, 1907) was the president of the Knickerbocker Trust Company, the collapse of which shortly before Barney's death sparked the Panic of 1907. Early life Charles T. Barney was born on January 27 ...
* 1907–1908: A. Foster Higgins * 1908–1912:
Charles H. Keep Charles Hallam Keep (1861 – August 30, 1941) was an American banker who served as Assistant Secretary of the Treasury from 1903 to 1907 where he was chairman of the Keep Commission and later served as president of the Knickerbocker Trust. Early ...


References

;Notes ;Sources


External links


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{{Authority control 1884 establishments in New York (state) 1900s economic history 1907 in the United States 1912 disestablishments in New York (state) 1912 mergers and acquisitions Banks disestablished in 1912 Banks established in 1884 Defunct banks of the United States Defunct companies based in New York (state) Defunct financial services companies of the United States Fifth Avenue