ABSTRACT
The 1980s were traumatic for the U.S. savings and loan industry. During the early part of the decade, the industry was subjected to deregulation in the form of the Depository Institutions Deregulation and Monetary Control Act of 1980 (DIDMCA) and the Garn–St.Germain Act in 1982. A torrent of mergers occurred in anticipation of and as a result of deregulation. These and other events have resulted in a federally assisted industry bailout that it expected to cost over 300 billion U.S. dollars. As a result, there has been a focusing of scholarly and regulatory attention on both the operating characteristics and the efficiency of the savings and loan industry. Additionally, competition has forced S&Ls to strive for increased operational efficiency as exemplified by cost reduction per unit of output in order to survive.
