Too Far Gone To Bring Back

Liquidating two big S and Ls

Even in an era of perilously go-go thrifts, the two California savings and loan associations seemed to be looking for trouble. One of them loaned money for energy schemes ranging from windmill farms to cow-manure incineration, while the other served as a whimsical and allegedly fraudulent investment machine for its owner, a former dentist. Last week federal regulators said they would liquidate the two ailing S and Ls, a drastic step for institutions so large. The Federal Savings and Loan Insurance Corp., which guarantees thrift deposits, will spend a record $1.35 billion in cash to pay off insured depositors (up to...

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