A STUDY OF THE IMPACT OF THE FLOW OF DEPOSITS ON THE BALANCE SHEETS OF THE MUTUAL SAVINGS BANKS AND THE SAVINGS AND LOAN ASSOCIATIONS OF NEW YORK STATE: A SECTIONAL COMPARISON 1966-1980
The purpose of this study is to determine and compare the impact of the flow of deposits on the balance sheets of the mutual savings banks (MSBs) and the savings and loan associations (SLAs) of New York State (NYSTATE). They were compared to each other for the years 1966 to 1980 with a 1981 update. The State was divided into two sections, NYCITY, basically the New York City SMSA plus Nassau and Suffolk counties and NYOTHER, the balance of the State. These were also compared to each other.^ A substantial review of the literature investigated 5 major commissions and studies. Major industry problems were also examined. Finally the Depository Institutions Deregulation and Monetary Control Act of 1980 was examined and summarized.^ It was hypothesized that the two subareas of each institution would have different reactions to the same influences, and also that the two thrifts would have different reactions. The statistical tool was a correlation coefficient analysis with 60 data points.^ Chapter 3 analyzed the liability accounts. Chapter 4 analyzed asset account management, including a discussion of liquidity. Chapter 5 analyzed net worth as a proxy for profit. The balance sheet accounts were compared for relationships to the flow of deposits, the market place yields, and to each other.^ The major findings for these chapters can be summarized as follows: (1) the MSBs and SLAs are not different in their reactions except in their asset management; (2) that the inflows have not "suffered" from high interest rates; (3) that mortgage loans were not terribly affected until 1980, only the rate of increase was affected; (4) there has been an increasing sensitivity of deposit flows to interest rates; (5) the liquidity ratios have improved, but the improvement is deceptive; (6) that regular passbook savings held up in NYOTHER until 1979.^ The evidence presented supports the hypothesis that NYCITY will have different reactions than will NYOTHER to the same type of influences with each type of thrift institution.^ The evidence presented supports the hypothesis that the two types of institution of NYSTATE will have different reactions to the same type of influences.^ There is a major public policy issue pinpointed by this study. The thrifts have been historically viewed as separate and distinct institutions which react differently and which are viewed as different by the public. The evidence does not confirm this. The liability accounts did not support the hypotheses. Should the regulators, the legislatures, and the various banking authorities continue to view them as separate. This study suggests that they do not do so and regulate for them as if they are identical and equal. ^
FREY, JOSEPH P, "A STUDY OF THE IMPACT OF THE FLOW OF DEPOSITS ON THE BALANCE SHEETS OF THE MUTUAL SAVINGS BANKS AND THE SAVINGS AND LOAN ASSOCIATIONS OF NEW YORK STATE: A SECTIONAL COMPARISON 1966-1980" (1982). ETD Collection for Pace University. AAI8227250.
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