Often simply called a Savings & Loan this is a financial institution somewhat like a bank. They are primarily found in the United States, where the first one was started in AD 1831. Also sometimes called a Thrift, Savings Bank, or Building Association, one was featured prominently in It's a Wonderful Life.

They can either be run as a mutual stock institution similar to a Mutual Savings Bank, where the board is not chosen by the depositors but all profits are distributed to depositors in the form of higher interest rates or as a capital stock institution more like a traditional bank.

The original purpose of the Savings and Loan Associations was to raise capitol for local home building in smaller towns. Local depositors lending their money to local citizens would help the community both economically and socially, or so the theory went. Previous to the AD 1930 depression S&Ls only loaned out money for short periods of time as loans with a term longer than five years were thought to be too risky.

This changed with the advent of deposit insurance as part of the new deal. For banks there was the FDIC and for the Savings and Loan companies there was the Federal Savings and Loan Insurance Corporation or FSLIC. There was also created a sort of separate Federal Reserve for the S&L, the Federal Home Loan Bank. The loans authorized for them to make was raised until a 30-year loan became the standard.

Due to volatility of interest many of the Associations were financially shaky by the end of the 1970's and to relive this problem the industry's regulation was changed. Starting in 1980 the deregulatory measures allowed savings and loan associations to enter the business of commercial lending, trust services, and nonmortgage consumer lending. It is thought that this and other changes are what caused the Savings and Loan Crisis in the mid-1980's until the early 1990's. It was so bad that in AD 1989 the FSLIC became insolvent, the total cost to bail out the industry is estimated at $500 billion dollars.

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