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Savings and Loan Debacle

The savings and loan (S&L) debacle of the1980s refers to the failure of an exceptionally large number of savings and loan banks, generally referred to as thrift institutions, in the United States between 1980 and 1995 and the attendant costs for the economy, the thrift institutions themselves, and the taxpayers. This was the most severe banking crisis the U.S. economy had suffered since the Depression. During this period, 1,043 institutions with total assets of more than $500 billion, insured by the Federal Savings and Loan Insurance Corporation (FSLIC), and the FSLIC itself failed, and about another 600 banks received Federal Deposit Insurance Corporation assistance. By 1999, the crisis had cost $153 billion. The bill for taxpayers was $124 billion, and the S&L industry paid the ...

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