DEFINIT✃ION of the Office of Thrift Supervision (OTS)

The Office of Thrift Supervision was a bureau of the U.S. Treasury Department that was responsible for issuing and enforcing regulations governing the nation's savings and loan industry. In 2011, the OTS was merged with other agencies including the Office of the Comptroller of the Currency, the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve Board of Governors, and the Consumer Financial Protection Bureau (CFPB).

Understanding the OTS

This bureau was responsible for ensuring the safety and s🦹oundness of deposits in thrift banks. It did this by auditing and inspecting the banks to see if government regulations andꦿ policies were being adhered to.

How the OTS Worked

The Office of Thrift Supervision (OTS), the successor to the 澳洲幸运5官方开奖结果体彩网:Federal Home Loan Bank Board, was established by Congress in 1989 as the primary federal regulator of all federal and state-chartered savings institutions across the nation that belong to the Savings Association Insurance Fund (SAIF). OTS issued federal charters for savings and loan associations and savings banks. This Bureau adopted and enforced regulations to ensure that both federal and state-chartered thrift institutions operated iﷺn a safe and sound manner, according to the Treasury Department.

The OTS was formed following the savings and loan (S&L) crisis, which began under the volatile interest rate climate of the 1970s when vast numbers of depositors withdrew their money from S&L institutions and deposited them in 澳洲幸运5官方开奖结果体彩网:money market funds. To remain in business, S&Ls began engaging in high-risk activities to cover losses, such as commercial real estate lending and investments in 澳洲幸运5官方开奖结果体彩网:junk bonds. Depositors in S&Ls continued to funnel money into these risky endeavors because their deposits were insured by the Federal Savings and Loan Insurance Cor༺poration (FSLIC).

Widespread corruption and other factors led to the 澳洲幸运5官方开奖结果体彩网:insolvency of the FSLIC, the $124 billion bailout of junk bond investments, and the liquidation of more than 700 S&Ls by the 澳洲幸运5官方开奖结果体彩网:Resolution Trust Corporation.

OTS began enforcing stricter regulations as it shut down hundreds of troubled i▨nstitutions꧃. The number of thrift banks has dwindled over the years, from nearly 4,000 in the 1980s to less than 1,000 in 2018. 

Thrifts are savings and loans associations. Thrifts also refer to 澳洲幸运5官方开奖结果体彩网:credit unions and 澳洲幸运5官方开奖结果体彩网:mutual savings banks that provide a variety of saving and loans services. Thrif🐬ts differ from commercial banks in that they can borrow moneyꦜ from the Federal Home Loan Bank System, which allows them to pay members higher interest.

Due to their charter, thrifts are ma⛄ndated🧸 to focus on housing-related assets and must be members of the Federal Home Loan Bank System.