Jan 17 2011

What is a savings and loan?

Category: Business & Economy

Answer:

A savings and loan (also called a thrift) is a type of financial institution with traditional holdings of savings accounts, mortgages, and other types of loans. The difference between a savings and loan and a bank is that the borrowers and depositors of an S&L have the unique ability to have a say in the financial and managerial objectives of the organization.

In recent years, many savings and loans have shifted their holdings and strategy to take advantage and adapt to today’s current market conditions. For many S&Ls, the competition from other lending institutions has negatively impacted their ability to earn a profit like they’ve done in the past. In order to offer a higher rate of return to their shareholders, today’s S&Ls will often choose to imitate banks and offer a number of conventional banking services and products. This shift will ultimately make it harder to distinguish a savings and loan from a regular bank.


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