The Depression Era Laws That Led to the 1980s Savings and Loan Crisis
Federal Insurance for Bank Deposits Encouraged Consumers, Bankers, and Politicians to Make Riskier and Riskier Choices
In 1986, Citicorp vice chairman Hans H. Angermueller sat before Congress, complaining that federal red tape made a nightmare of buying a special type of bank that specialized in making home loans and was known as a “thrift” or “savings and loan”—or “S&L” for short.
“So why bother?” he asked lawmakers.
He was posturing. Citicorp, the nation’s largest banking holding company at the time, very much wanted to bother with those kinds of banks. Even as Angermueller complained, his colleagues a few blocks away were wrestling with oil billionaire Gordon …