Recent Developments in the Savings and Loan Industry

by Eugene Brigham



The underlying trends revealed by the author's hypothetical housing inventory model and the actual housing market situation in California suggest that this market is due for a strong recovery from which the savings and loan (S&L) would benefit. The housing and mortgage markets have been in the doldrums in recent months-nationwide, starts were down some 50 per cent in 1966 from the 1963 level. This decline has affected the entire economy, but certain sectors have been hit especially hard-the S&L industry is such a sector. Their problems have stimulated the S&L associations and their regulators to take a hard look at the industry and the environment within which it operates. This article synthesizes several of these efforts and gives a general picture of some long-run factors which have influenced and probably will continue to influence the industry. The first section describes the forces leading to S&Ls' dramatic growth during the 1950s and the early 1960s; it emphasizes, particularly, the likelihood that these same forces will continue to operate during the coming years.

California Management Review

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Published at Berkeley Haas for more than sixty years, California Management Review seeks to share knowledge that challenges convention and shows a better way of doing business.

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