New York's Savings Banks Triving/'it's Whoopy Time'

By Eric N. Berg, Ny Times | THE JOURNAL RECORD, February 1, 1987 | Go to article overview
Save to active project

New York's Savings Banks Triving/'it's Whoopy Time'

Eric N. Berg, Ny Times, THE JOURNAL RECORD

NEW YORK - Like the city itself, which went from the precipice of bankruptcy in the 1970s to prosperity, New York's savings banks are back.

When interest rates passed 20 percent in the early 1980s, savings banks suffered so badly that regulators thought the entire industry might crumble. The banks' capital was virtually wiped out by gaping losses as they were caught between having made long-term, fixed-rate loans at low rates and having to pay higher rates for deposits. The institutions could not even be sold, so serious was their plight. Now, thanks to lower interest rates, balance-sheet restructuring, diversification and a removal of usury ceilings, the savings banks are again prospering.

``We're not only seeing the light at the end of the tunnel; we're out of the tunnel,'' said John T. Morgan, chief executive of the American Savings Bank. ``It's whoopy time.''

Profits have clearly recovered. After losing hundreds of millions of dollars in each of the preceding five years, the New York savings banks returned to profitability in 1985, earning $573.8 million, for a return on assets of 0.81 percent. In the first six months of 1986 alone, the savings banks exceeded this profit level, earning $800.7 million, for a healthy 1.09 percent return on assets.

As a result, savings banks have become some of the hottest properties around. In the last six weeks, two of New York's oldest savings banks - the Emigrant and the Williamsburgh - have been sold. In the last 15 months, ownership has changed at five other big New York State savings banks: the Bowery, Dollar Dry Dock, East River, Seamen's and the Savings Bank of Rockland County. The sale of the seven institutions has led to a change in control of $20 billion out of the $120 billion of New York savings-bank deposits.

Besides demonstrating how much savings banks' prospects have brightened, the quicker pace of sales has tantalized other prospective buyers. Indeed, industry experts say that it is only a matter of time before another big local savings bank goes on the block.

The rest of this article is only available to active members of Questia

Sign up now for a free, 1-day trial and receive full access to:

  • Questia's entire collection
  • Automatic bibliography creation
  • More helpful research tools like notes, citations, and highlights
  • Ad-free environment

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
Loading One moment ...
Project items
Cite this article

Cited article

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited article

New York's Savings Banks Triving/'it's Whoopy Time'


Text size Smaller Larger
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

While we understand printed pages are helpful to our users, this limitation is necessary to help protect our publishers' copyrighted material and prevent its unlawful distribution. We are sorry for any inconvenience.
Full screen

matching results for page

Cited passage

Citations are available only to our active members.
Sign up now to cite pages or passages in MLA, APA and Chicago citation styles.

Cited passage

Welcome to the new Questia Reader

The Questia Reader has been updated to provide you with an even better online reading experience.  It is now 100% Responsive, which means you can read our books and articles on any sized device you wish.  All of your favorite tools like notes, highlights, and citations are still here, but the way you select text has been updated to be easier to use, especially on touchscreen devices.  Here's how:

1. Click or tap the first word you want to select.
2. Click or tap the last word you want to select.

OK, got it!

Thanks for trying Questia!

Please continue trying out our research tools, but please note, full functionality is available only to our active members.

Your work will be lost once you leave this Web page.

For full access in an ad-free environment, sign up now for a FREE, 1-day trial.

Already a member? Log in now.

Are you sure you want to delete this highlight?