Abstract

The Banking Panic of 1907 was the final banking panic that took place during the National Banking Era (1863–1913); the most severe of these panics occurred in 1873, 1893 and 1907, whereas the episodes of financial distress in 1884 and 1890 were considered minor in comparison. A central difference between the Panic of 1907 and all the earlier panics of the National Banking Era was the type of financial intermediaries that were struck with panicrelated withdrawals. During the prior panics, national banks were more notably affected by widespread withdrawal of deposits. In 1907, widespread withdrawals centered on New York City trust companies, which were state-chartered intermediaries. The aggregate assets of the trust companies were small during prior panics, but had grown rapidly in the decade prior to 1907. By that time, trust companies were second only to national banks in aggregate assets and aggregate net deposits among depository institutions within the New York City financial market.