The Office of Thrift Supervision, which has argued repeatedly that today's thrifts aren't any riskier than banks, released a study Thursday to back up its claim.
The survey of bank and thrift failures from 1985 to 1995, conducted by OTS senior economist Eric Hirschhorn, shows that savings and loans that met the capital and lending standards now required of all thrifts did not fail markedly more often than banks.
Jonathan Fiechter, the agency's acting director, said the study was meant to counter concerns that merging the Bank Insurance Fund with the Savings Association Insurance Fund would expose the bank fund to greater losses.
"It is inaccurate to argue that you are putting the BIF at risk of bringing institutions into it that are as likely to fail going forward as the thrift industry was in the 1980s," Mr. Fiechter said. "It's really a different industry (now) than the industry that caused the failures."
Mr. Hirschhorn sifted through past industry data to separate out what he called "mortgage specialist thrifts" - that is, institutions that fell within current legal and regulatory limits on nonmortgage lending by thrifts.
He found that the deposit insurance losses caused by mortgage specialist thrifts were minuscule in comparison with the losses caused by thrifts that had diversified into commercial real estate, junk bonds, and the like.
In comparison with commercial banks, the mortgage specialist thrifts did cause greater losses to their insurance fund. However, when Mr. Hirschhorn separated out mortgage specialists with capital levels similar to banks' - above 3% of assets - he found that they failed in only slightly greater numbers than banks and actually resulted in smaller insurance fund losses than banks did.
Mr. Fiechter said the study was needed because, while it is widely acknowledged that savings and loans that stuck to home mortgage lending were more likely to survive the 1980s than institutions that did not, he still hears arguments that thrifts are failure-prone.
"You will still see commentary today of folks talking about the inherent risk in the thrift industry because of this mortgage lending concentration," he said.