DEFINITION of 'Garn-St. Germain Depository Institutions Act '

A law enacted by Congress in 1982 to enable banks and other savings institutions to compete more readily in the money market. It got rid of the interest rate ceiling that they once had to abide by, authorized them to make commercial loans and gave the federal agencies the ability to approve bank acquisitions.

BREAKING DOWN 'Garn-St. Germain Depository Institutions Act '

This act was one of the contributing factors of the Savings and Loan Crisis. The S&L crisis was one of the largest government bailouts in U.S. history costing approximately $124 billion. The bailout came to help the 747 savings and loan associations in the U.S. but failed, partly due to the Garn-St. Germain Depository Institutions Act.

RELATED TERMS
  1. Depository Institutions Act of ...

    A law passed by Congress with the intent of making savings and ...
  2. Depository

    On the simplest level, depository is used to refer to any place ...
  3. Federal Savings and Loan

    A federally chartered savings and loan is a banking institution ...
  4. Building And Loan Associaiton

    It is a depository financial institution that is federally or ...
  5. Truth in Savings Act

    A federal law passed by Congress on December 19, 1991 as part ...
  6. Financial Institutions Regulatory ...

    A United States Federal law enacted in 1978 pertaining to depository ...
Related Articles
  1. Insurance

    From Booms To Bailouts: The Banking Crisis Of The 1980s

    The economic environment of the late 1970s and early 1980s created the perfect storm for a banking crisis.
  2. Insights

    Top 6 U.S. Government Financial Bailouts

    U.S. bailouts date all the way back to 1792. Learn how the biggest ones affected the economy.
  3. Insights

    Financial Regulations: Glass-Steagall to Dodd-Frank

    Here are some of the most important financial regulations that have been established.
  4. Personal Finance

    Depository Trust Company

    The Depository Trust Company, founded in 1973 and based in New York City, is one of the world's largest securities depositories.
  5. Personal Finance

    How Banks Set Interest Rates on Your Loans

    Many factors go into how banks set interest rates for loans. Use this information to negotiate the best possible rate when you're borrowing.
  6. Investing

    How The U.S. Government Formulates Monetary Policy

    Learn about the tools the Fed uses to influence interest rates and general economic conditions.
  7. Insights

    An Introduction to Government Loans

    Government loans further policymakers' efforts to create positive social outcomes by offering timely access to capital for qualified candidates.
  8. Personal Finance

    Understanding Loans

    A loan is the act of giving money, property or other material goods to another party with the expectation of being repaid.
  9. Personal Finance

    Should Congress Raise The Debt Ceiling?

    Some members of Congress say the debt ceiling must be raised while others insist it's time Uncle Sam learned how to get by without any more borrowing. We'll look at the issues at stake.
  10. Insights

    What's a Price Ceiling?

    A price ceiling is the maximum amount a seller can charge for a product or service.
RELATED FAQS
  1. What are the similarities and differences between the savings and loan (S&L) crisis ...

    Learn about some of the similarities and differences between the savings and loan crisis and the subprime mortgage crisis ... Read Answer >>
  2. How do commercial banks make money?

    Learn the different ways commercial banks make money, including interest from loan products and banking fees charged to customers. Read Answer >>
  3. What measures could the U.S. Government take to prevent another crisis similar to ...

    Discover what measures the U.S. government could take to prevent another crisis similar to the S&L crisis. The S&L crisis ... Read Answer >>
  4. How does investment banking differ from commercial banking?

    Discover how investment banking differs from commercial banking, the responsibilities of each and how the two can be combined ... Read Answer >>
  5. What is the difference between a savings & loan company and a bank?

    Find out how a savings and loan company, sometimes also known as a thrift or savings institution, focuses on different types ... Read Answer >>
Hot Definitions
  1. Asset Turnover Ratio

    The amount of sales generated for every dollar's worth of assets in a year, calculated by dividing sales by assets.
  2. Book Value

    1. The value at which an asset is carried on a balance sheet. To calculate, take the cost of an asset minus the accumulated ...
  3. Dividend Yield

    A financial ratio that shows how much a company pays out in dividends each year relative to its share price.
  4. Fixed-Income Security

    An investment that provides a return in the form of fixed periodic payments and the eventual return of principal at maturity. ...
  5. Free Cash Flow - FCF

    A measure of financial performance calculated as operating cash flow minus capital expenditures. Free cash flow (FCF) represents ...
  6. Leverage Ratio

    Any ratio used to calculate the financial leverage of a company to get an idea of the company's methods of financing or to ...
Trading Center