Charles Tracy Barney (January 27, 1851 – November 14, 1907) was an American banker who 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, 1851, in Cleveland, Ohio, the son of Ashbel H. Barney (1816–1886) and Susan ( Tracey) Barney. His father was a successful forwarding and commission merchant.
In 1857, the family moved to New York City, where his father was a director (1859–83), vice president (1867–69) and president (1869–70) of Wells Fargo & Company.
Barney attended Williams College in Williamstown, Massachusetts, where he was a member of The Kappa Alpha Society, graduating in 1870. Following graduation he moved to New York and entered banking. With his mustache and beard and slightly thinning hair, Barney somewhat resembled his late, well-regarded father in appearance.
Banking career
His ties to the Whitney family helped him achieve great success in banking, real estate investment and opened the door to profitable business opportunities. Barney was made a special member of the firm of Rogers & Gould, members of the New York Stock Exchange. He joined the Knickerbocker Trust Company in 1884, was elected vice president in the 1890s and in 1897 succeeded Robert MacClay as president. During his tenure at Knickerbocker, the company's total deposits rose from $11 million to over $65 million. At its peak it was the third largest trust company in the city. In 1902-04 it built a new main office at the corner of Fifth Avenue and 34th Street (pictured), designed by McKim, Mead and White. There were also branch offices at 66 Broadway and in Harlem and The Bronx.
In his real estate operations, Barney joined William C. Whitney, Henry F. Dimock, W.E.D. Stokes, Francis W. Jenks, and others in forming the New York Loan and Improvement Company in 1890. This concern was responsible for the development of the Washington Heights section of New York City. He formed with George D. Sheldon and others in 1899 the so-called Barney-Sheldon real estate syndicate.
Besides serving as president and a director of the Knickerbocker Trust Company, Barney was president and a director of the New York Loan and Improvement Company; a trustee of the Bank for Savings; a director of the Brooklyn Life Insurance Company, Lawyers' Mortgage Insurance Company, United States Realty and Improvement Company, Title Insurance Company of New York, New York Mortgage and Security Company, Century Realty Company, Hudson Mortgage Company and Chelsea Realty Company; and a shareholder of the Santa Cecilia Sugar Company, Cuba Hardwood Company, Cuba Northeastern Railroad, American Ice Company, Ice Securities Company, Eastern Steamship Company, Metropolitan Steamship Company, Dominion Iron Company Ltd., Dominion Iron and Steel Company Ltd., and the Hudson Navigation Company (the Hudson River Night Line). He was also an investor in the New York City Subway and the Metropolitan Opera and Real Estate Company. Barney was also treasurer of the New York Zoological Society from 1901 to 1903.
Panic of 1907
In 1907, the Knickerbocker entered into a deal organized by speculators F. Augustus Heinze and Charles W. Morse to corner the market of the United Copper Company. On Tuesday, October 15, 1907, their plan failed spectacularly when the share price of United Copper collapsed. Heinze's brokerage firm failed on October 17, and he was forced to resign as president of the Mercantile National Bank. On October 19 Morse was forced out of the banks with which he had been associated. Realizing that the Knickerbocker was involved in the failed cornering, depositors began to remove their deposits from the bank.
On October 21, Monday of the week after the bid collapsed, the board of the Knickerbocker Trust Company 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. The next day, a massive bank run 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 keystone of the Panic of 1907.
Barney's successor as president of Knickerbocker, A. Foster Higgins of Greenwich, Connecticut, was an unfortunate choice. He 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.