S&L Crisis Unlikely Abroad, Thrift Leader Tells Conferees
Turmoil in the U.S. thrift industry hasn't gone unnoticed by housing lenders in other nations.
But at a gathering in Hamburg, Germany, the chairman of the U.S. League of Savings Institutions, Donald Shackelford, had some soothing words for his international counterparts: It probably can't happen to you.
The thrift debacle was rooted in a misguided government policy of shielding homeowners from interest rate shocks, Mr. Shackelford said in a speech to the 19th World Congress of the International Union of Housing Finance Institutions. Luckily, he added, "few nations have sought to emulate" that policy.
It's a good thing Mr. Shackelford mentioned it. If he hadn't, his fellow delegates from 30 nations might never have pried.
"They are so restrained and polite," he said. "You've got to be the one to bring it up."
Anxiety About 1992
Once he broke the ice, Mr. Shackelford got a few tactful queries. Lenders from Nigeria and Costa Rica worried about the pitfalls of the thrift business. British building and loan executives - facing a merged European financial system in 1992 - wondered whether unity might sow the seeds of an American-style thrift crisis.
Mr. Shackelford, chairman and chief executive of State Savings Bank, Columbus, Ohio, said the annual meeting gives domestic mortgage lenders a valuable opportunity to compare notes and learn from their counterparts in other nations.
"There are some universals out there," Mr. Shackelford said. "It's a little spooky, but there is some softness is housing values worldwide."
A handful of nations with traditional building and loan systems dominated the meeting, which drew nearly 800 delegates and observers. Besides the U.S. lenders, there was a heavy contingent from Germany, Britain, Australia, and South Africa.
Bevy of Smaller Nations
But nations with smaller thrift systems also turned out. Mr. Shackelford met delegates from Zimbabwe, Central and South America, Russia, Eastern Europe, and Trinidad and Tobago.
If Mr. Shackelford returns for the meeting in 1992, when he will be in his second consecutive term as U.S. League chairman, he won't let the association pick up the tab.
"I don't think the members ought to pay for this trip," he said.