S and Ls Send Out an S O S

Threatened by younger, more alluring and higher-yielding money-market funds, the long marriage between investors and the American savings and loan associations is in trouble. This year S and Ls may lose $5 billion of their $32 billion in net capitalization. To stem the flight of depositors, they have had to offer new savings instruments with higher and higher interest rates. The conundrum: at the same time that they carry huge portfolios of old mortgages, including some that were made in the 1960s and yield 6% or 7%, S and Ls must pay 15% or more for new deposits. As a result,...

Want the full story?

Subscribe Now


Get TIME the way you want it

  • One Week Digital Pass — $4.99
  • Monthly Pay-As-You-Go DIGITAL ACCESS$2.99
  • One Year ALL ACCESSJust $30!   Best Deal!
    Print Magazine + Digital Edition + Subscriber-only Content on TIME.com

Learn more about the benefits of being a TIME subscriber

If you are already a subscriber sign up — registration is free!