NEWFOUNDLAND Ten Cents 1894

NEWFOUNDLAND Ten Cents 1894

$23.00

.107oz \.70in \17.75×1.00 mm

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Description

The Newfoundland Bank Crash of 1894, known as Black Monday, was one of the turning points in Newfoundland’s pre-Confederation history.

The financial woes of the former British colony were worsened when two of the colony’s commercial banks, the Union Bank of Newfoundland (established in 1854) and the Commercial Bank of Newfoundland (established in 1858), both located in St. John’s, Newfoundland, Canada, closed their doors to the public on December 10, 1894. Fish merchants sat on the boards of directors of both of these banks, and had approved large and risky loans to themselves, leaving the banks with dangerously small cash reserves leading into the crash.

London banks suspended credit to the Commercial Bank of Newfoundland and requested payment on some of its loans. The Commercial was unable to meet these demands and was forced to close two days later. A bank run ensued on both the Union and Savings Banks. The government-run Savings bank was able to weather the storm, but the Union was forced to close that day, never to re-open.

 

 

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