Laying the groundwork for American industry
U.S. Trust played a significant role in funding many of the nation’s railways during the American Industrial Revolution.
The development of railroads in America was one of the most important drivers of the Industrial Revolution. With railroad construction and operation, profound social, economic and political changes were shaping the future of our country.
When the first railroads in New York State were constructed from the early 19th century, they were built by individual companies and formed a disparate series of tracks across the state. In 1855, they were all consolidated into the New York Central Railroad, a huge and expensive undertaking funded by a partnership between U.S. Trust and its corporate clients. U.S. Trust served as corporate trustee for these transactions, handling the administration, processing and record keeping for the securities involved. Some of U.S Trust's earliest corporate clients include familiar names such as International Paper Corporation, United States Steel Corporation, and railroads such as Illinois Central, Union Pacific and Baltimore and Ohio (B&O).
With the completion of the New York Central Railroad, it was possible for the first time to board a train and journey east or west without having to get off and walk to the next train station, board another train and continue on. It didn't just reduce travel time for travelers, but also greatly improved the speed of shipping goods all over the Northeast. It set the precedent for the rest of the country, and new railroads came swiftly.
The New York Central Railroad was one of the largest American railroads operating in the Northeast. Headquartered in New York City, the railroad served much of New York State, Pennsylvania, Ohio, Michigan, Indiana, Illinois and Massachusetts, plus additional routes in the Canadian provinces of Ontario and Québec.
The securities issued by U.S. Trust and its corporate clients paid for much of the nation's railway construction. The bank was also involved in the funding of the Panama Canal beginning as early as 1860. The construction of this canal through the narrow land bridge between North and South America was held up for decades due to political issues but was eventually completed in 1914.
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