New Interstate Rules May Speed Thrift Marriages; Bank Board Proposal Would Help California Institutions Anxious to Expand on West Coast

By Easton, Nina; Naylor, Bartlett | American Banker, December 24, 1985 | Go to article overview

New Interstate Rules May Speed Thrift Marriages; Bank Board Proposal Would Help California Institutions Anxious to Expand on West Coast


Easton, Nina, Naylor, Bartlett, American Banker


WASHINGTON -- The Federal Home Loan Bank Board's proposal to loosen interstate restrictions on federal thrifts would accelerate consolidation in the industry and prompt more large Claifornia institutions to establish a regional presence in the West, analysts said Monday.

The Bank Board's plan would accelerate an already "massive consolidation" in the industry, said Jonathan Gray of Sanford C. Bernstein & Co. "The opportunity exists to build a very large thrift institution." Mr. Gray added that the plan, if adopted, would further encourage nonfinancial companies to move into the savings and loan business.

Under the proposal unveiled by the Bank Board last week, a purchaser of an insolvent savings and loan would be rewarded with entry rights to three states in addition to the insolvent thrift's home state. The additional states need not be contiguous to the insolvent thrift's state. In addition, healthy federal thrifts would be granted the same interstate privileges as state-chartered thrifts operating under regional compacts.

Robert Chaut, a thrift analyst with Salomon Brothers Inc., said a number of large, profitable California thrifts are anxious to move into the nearby states of Washington, Nevada, Oregon, and Arizona. In order to gain access to these states, he said, they are likely to be willing to purchase a small failed thrift in the East or Midwest.

In addition, Roger Powell of Alex. Brown & Sons predicted a pickup in interstate activity between thrifts in North Carolina, south Carolina, and Virginia as a result of the provision permitting federal thrifts the same intersate expansion rights as state thrifts and banks. "To the extent that this will give [some thrifts] a headstart on interstate branching, it will be a benefit to them for the next 10 years," said Washington, D.C., attorney Thomas Vartanian.

Nationwide, "Hundreds" of institutions are in a financial position to expand interstate by acquiring failed thrifts, said Mr. Gray of Sanford Bernstein. However, analysts agree that only large institutions, particularly those with assets of more than $1 billion, are likely to make that move.

Despite the potential impact of the Friday's Bank Board proposal, Washington lawmakers and lobbyists responded calmly on Monday. Some observers read the apparent acceptance as a sign that fragility of the federal thrift insurance fund is taking precedence over the emotional issues associated with interstate expansion.

Rep. Charles Schumer, D-N.Y., a member of the House Banking Committee, lauded Bank Board Chairman Edwi Gray's move to bolster the weakened Federal Savings and Loan Insurance Corp. Mr. Gray "is, in general, doing his best. If this serves as a shot across the bow to wake up the [Reagan] administration to the problems of thrifts, it will be helpful."

Holidays have thinned many Washington offices, but some officials predict Congress may ask the Bank Board to amend its proposal when the second session resumes in late January.

Consumer advocates such as Rep. …

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

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.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

New Interstate Rules May Speed Thrift Marriages; Bank Board Proposal Would Help California Institutions Anxious to Expand on West Coast
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
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?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    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.

    Buy instant access to save your work.

    Already a member? Log in now.

    Author Advanced search

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.