Talk:Savings and loan association

Starting this entry

I was hopeing that people would come buy with some more research on this subject. I can fake my way through most parts, but I'm most familiar with the organization and its style of operation than I am with the actual failures. I suppose this is a good time for me to read up on that.

Some more information about how these differ from Credit Unions or regular banks would be nice.

Mutual savings banks and Savings and Loan associations differ somewhat in both ideology and function. Mutual savings banks were started as philanthropic endeavors to provide the working classes with financial stability. S&Ls began in the 1830s to provide access to home ownership. They initially functioned much more like fraternal associations than like "banks." This is very true as exhibited by their charters for existance. The Mutual being a membership only or a fair representation of its respective community was there to serve "those members" what we know today as a modern day credit union. They lived long and prospered until two change catylist entered the scene. First the investment bankers who during the last twenty years prey on those that survived the last 200 years. This group of investment charlitans convince the current management that its their deserving duty to take the years of trust and reward the community (and make themselves) a tremendous amount of money. By taking the Mutual and converting it to stock based on ones deposit size then converting it again to common stock those in round one make an unimaginable amount of money. Then they leave the institution of say 200 years old that has transacted its business the same way for two milineium that it needs to move from a transaction based culture to a relationship culture. This task is so immense as the institution must now focus on the bottom line and stock price that it's management is ill equipted. As the Stock price plumets and the buzzards begin to circle. The second most transforming change for this industry and for the S&L's was checking...this was like giving them fire. They now could compete for deposits and make larger loans because they did not have to depend on their inner sphere of members or community to support their ever increasing demand for deposits. Thus Milken shows up with deposits from Junk Bonds and the demise of the S&L industry begins. It would not be deserving of the Mutuals that have survied all these years to class them with S&L's except that the last dinosaurs always eats best.

Early mutual savings banks considered it important to emphasize their dissemblance from S&Ls and other thrift institutions, because they did not have commercial components to their business.

In the UK this type of institution is called a building society. There may be merit in a merger of all three pages, but a proper analysis and discussion of the fundamental diffences in constitution would be in order before that was done. For instance may types of banking institution offer deposit accounts, loan accounts, mortgages etc. but not all can be called banks. Building societies are mutually owned and technically non-profit making instituions. The reality is though they act in in a very similar way to commercial enterprises in most respects. However, they cannot be caled "banks" as a point of law due to their mutual status.

On savings banks, S&L and building societies.

I agree that there is much to do in the analysis of organisational differences between the financial intermediaries above mentioned. We are adding some bits on trustees savings banks in UK and Spanish savings banks. Hopefully this will show they are different from their US counterparts (i.e. Savings and Loans).

Bernardo Batiz-Lazo 11:37, 13 November 2006 (UTC) Bbatiz

Savings & Loan Association vs. Mutual Savings Bank

This may be a discussion related to semantics, however from my perspective a Savings Bank, even a Mutual Savings Bank is different from a Savings & Loan Association.

Although the two may have the same overall organization, it seems to me that a Mutual Savings Bank may be more membership oriented, like a credit untion, than a S&L. The name Mutual Savings Bank, is also more likely to be confused with an institution focused on taking deposits rather than a balanced organization interested in both taking deposits and making loans.

However, even if S&Ls and Savings Banks are the same in organization, it would be preferable to me that Mutual Savings Banks be merged into Savings & Loan Assn rather than the other way around. Especially considering that Savings & Loan Associations (Also called Building & Loan Assns in some parts) were the genesis of mutually owned financial institution types.

It seems to me that the names, as well as the scopes of operations, of those shops, change with every country. You find also various other in continental Europe. All those are just variations of cooperative banking where they should be merged in my opinion, if not readers will get completely confused.

I see enough difference between "Savings and Loan" and "Mutual Savings Bank" to keep them as separate articles. The point is almost moot now, with the vast majority of both in the USA having demutualized. Still, they have historically different purposes; information concerning one doesn't automatically hold for the other.