Federal Savings and Loan Insurance Corporation
Encyclopedia
The Federal Savings and Loan Insurance Corporation (FSLIC) was an institution that administered deposit insurance
for savings and loan institutions in the United States
. The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) abolished it and transferred the responsibility for savings and loan deposit insurance to the Federal Deposit Insurance Corporation
(FDIC).
The FSLIC was created as part of the National Housing Act of 1934
in order to insure deposits in savings and loans, a year after the FDIC was created to insure deposits in commercial banks. It was administered by the Federal Home Loan Bank Board
(FHLBB).
In the 1980s, during the savings and loan crisis
, the FSLIC became insolvent. It was recapitalized with taxpayer money several times, with $15 billion in 1986 and $10.75 billion in 1987. However, by 1989 it was insolvent to save and was abolished along with the FHLBB; and the FSLIC savings and loan deposit insurance responsibility was transferred to the FDIC. The FSLIC Resolution Fund was created to assume all the assets and liabilities of the FSLIC, and was to be funded by the Financing Corporation
(FICO).
Deposit insurance
Explicit deposit insurance is a measure implemented in many countries to protect bank depositors, in full or in part, from losses caused by a bank's inability to pay its debts when due...
for savings and loan institutions in the United States
United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
. The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (FIRREA) abolished it and transferred the responsibility for savings and loan deposit insurance to the Federal Deposit Insurance Corporation
Federal Deposit Insurance Corporation
The Federal Deposit Insurance Corporation is a United States government corporation created by the Glass–Steagall Act of 1933. It provides deposit insurance, which guarantees the safety of deposits in member banks, currently up to $250,000 per depositor per bank. , the FDIC insures deposits at...
(FDIC).
The FSLIC was created as part of the National Housing Act of 1934
National Housing Act of 1934
The National Housing Act of 1934, , also called the Capehart Act, was part of the New Deal passed during the Great Depression in order to make housing and home mortgages more affordable. It created the Federal Housing Administration and the Federal Savings and Loan Insurance Corporation.It was...
in order to insure deposits in savings and loans, a year after the FDIC was created to insure deposits in commercial banks. It was administered by the Federal Home Loan Bank Board
Federal Home Loan Bank Board
The Federal Home Loan Bank Board was a board created by the Federal Home Loan Bank Act of 1932 that created and oversaw the Federal Home Loan Banks also created by the act. It was superseded by the Federal Housing Finance Board and the Office of Thrift Supervision in the Financial Institutions...
(FHLBB).
In the 1980s, during the savings and loan crisis
Savings and Loan crisis
The savings and loan crisis of the 1980s and 1990s was the failure of about 747 out of the 3,234 savings and loan associations in the United States...
, the FSLIC became insolvent. It was recapitalized with taxpayer money several times, with $15 billion in 1986 and $10.75 billion in 1987. However, by 1989 it was insolvent to save and was abolished along with the FHLBB; and the FSLIC savings and loan deposit insurance responsibility was transferred to the FDIC. The FSLIC Resolution Fund was created to assume all the assets and liabilities of the FSLIC, and was to be funded by the Financing Corporation
Financing Corporation
The Financing Corporation is a mixed-ownership United States government-sponsored enterprise that operated as a financing vehicle for the Federal Savings and Loan Insurance Corporation Resolution Fund. As of July 1997 its outstanding debt stood at $8.2 billion...
(FICO).