This paper estimates the losses embedded in the capital positions of the 996 FSLIC-insured savings and loan institutions that did not meet capital standards at the end of the 1970s. We compare the estimated cost of resolving the insolvencies of these institutions at the end of the 1970s with the...

An investigation of the value of FSLIC forbearances to the stockholders of insolvent stock-chartered thrift institutions, concluding that these forbearances increase the stock-market value of thrift institutions.

An examination of the structure of the Resolution Trust Corporation and of its performance in resolving the savings and loan insurance crisis, defining the obstacles that may be impeding the RTC's effectiveness in closing insolvent thrifts and returning their assets to the private sector.

An argument that capital forbearance for thrifts in the 1980s was at best a misguided policy whose costs will have long-term consequences for the health of both the nation's depositories and the overall economy.

Regulatory agencies are unwilling or unable to close thrift institutions immediately upon insolvency. Instead, they have progressively reduced the thrift capital requirement, refrained from enforcing that requirement, and allowed thrifts to hold more nonmortgage loans in the hope that the...

A presentation of some of the options for recapitalizing the Savings Association Insurance Fund, with particular emphasis on merging it into the FDIC's Bank Insurance Fund.

An outline of three possible options for capitalizing the Savings Association Insurance Fund, which is in danger of suffering a huge premium disadvantage compared to banks insured by the Bank Insurance Fund, and a recommendation that any solution should first consider the policy objectives for...