Abstract: The Panic of 1825 was one of the world's first international financial crises. In this paper, I document how this crisis spread from London banks to England's real economy. England's correspondent banking network propagated trouble in sovereign debt markets to small banks outside of London and ultimately to non-financial firms. Using exogenous variation in town-level exposure to the crisis, I show that bank failures led to a substantial number of bankruptcies among non-financial firms, particularly in non-tradable sectors. These findings highlight the costs of a disruption to the payment system: country bank notes were the primary means of payment during the first industrial revolution. .