Mutual Savings Bank - MSB

DEFINITION of 'Mutual Savings Bank - MSB'

A type of thrift institution, originally designed to serve low-income individuals, that historically invested in long-term, fixed-rate assets such as mortgages. Initiated in 1816, the first mutual savings banks (MSBs) were the Philadelphia Saving Society and Boston's Provident Institution for Saving. Most MSBs were located in the Mid-Atlantic and industrial Northeast regions of the United States. By 1910, there were 637 of these institutions.

BREAKING DOWN 'Mutual Savings Bank - MSB'

MSBs were generally very successful until the 1970s. During the 1980s, regulations governing what they could invest in and what rate of interest they could pay to customers combined with rising interest rates to cause massive losses for MSBs. Consequently, many MSBs failed in the 1980s; others merged, became commercial banks or converted to stock form.

RELATED TERMS
  1. Thrift Bank

    A financial institution focusing on taking deposits and originating ...
  2. Savings Association Insurance Fund ...

    A government insurance fund for savings and loans and thrift ...
  3. Thrift

    Thrifts are savings and loans associations. Thrifts also refer ...
  4. Net-Worth Certificate

    An instrument used by the FDIC starting in 1982 as part of an ...
  5. Thrift Institutions Advisory Council

    A council that advises the Federal Reserve board of governors ...
  6. Federal Savings and Loan

    A federally chartered savings and loan is a banking institution ...
Related Articles
  1. Savings

    Find the Best Savings Account Rates

    You know how to spot the highest interest rate, but how do you really get the best deal on savings accounts?
  2. Savings

    4 Savings Accounts for Investors

    Curious about the best saving accounts and which ones suit investors?
  3. Fundamental Analysis

    2 Thrift Conversions for Your Portfolio (CHFN, WBB)

    Buying the stocks of these boring little banks can lead to very exciting profits.
  4. Investing Basics

    Saving vs. Investing: Understanding the Key Differences

    The terms saving and investing are sometimes used interchangeably, but they are very different and extremely important to understand in order to achieve security and prosperity.
  5. Retirement

    How To Start Saving For Retirement

    If you establish these money-saving habits and patiently allow your wealth to build, you will be taking some huge steps forward in making your financial future more secure.
  6. Investing

    10 Ways to Effectively Save for the Future

    Savings is as crucial as ever, as we deal with life changes and our needs for the future. Here are some essential steps to get started, now.
  7. Savings

    Understanding Savings Accounts

    A deposit account held at a bank or other financial institution that provides principal security and a modest interest rate.
  8. Investing

    Where Should I Keep My Down Payment Savings?

    While saving up for a down payment, where should you keep your money. A bank? The stock market? It all depends on your timeline.
  9. Credit & Loans

    Mortgage Basics: Fixed-Rate Mortgages

    By Lisa SmithA fixed-rate mortgage is a loan that charges a set rate of interest that does not change throughout the life of the loan. It is the traditional loan used to finance the purchase ...
  10. Options & Futures

    Demystification Of Bank Accounts

    Find out which type of account suits your specific needs.
RELATED FAQS
  1. What are the major categories of financial institutions and what are their primary ...

    Understand the various types of financial institutions that exist in today's economy, and learn the purpose each serves in ... Read Answer >>
  2. What economic factors affect savings account rates?

    Find out how supply, demand and central bank policy all affect savings account rates offered by banks for extra deposits ... Read Answer >>
  3. Can mutual funds outperform savings accounts?

    Learn why moving money from savings accounts to mutual funds may be one of the wisest financial decisions you ever make, ... Read Answer >>
  4. 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 >>
  5. What is the difference between a modified duration and a Macaulay duration?

    Understand how investors and savers can use money market mutual funds and conventional savings accounts, and learn the differences ... Read Answer >>
  6. Is a Thrift Savings Plan (TSP) a qualified retirement plan?

    Take advantage of the government's retirement plan for employees with the Thrift Savings Plan. As with a 401(k), contributions ... Read Answer >>
Hot Definitions
  1. Over-The-Counter - OTC

    Over-The-Counter (or OTC) is a security traded in some context other than on a formal exchange such as the NYSE, TSX, AMEX, ...
  2. Quarter - Q1, Q2, Q3, Q4

    A three-month period on a financial calendar that acts as a basis for the reporting of earnings and the paying of dividends.
  3. Weighted Average Cost Of Capital - WACC

    Weighted average cost of capital (WACC) is a calculation of a firm's cost of capital in which each category of capital is ...
  4. Basis Point (BPS)

    A unit that is equal to 1/100th of 1%, and is used to denote the change in a financial instrument. The basis point is commonly ...
  5. Sharing Economy

    An economic model in which individuals are able to borrow or rent assets owned by someone else.
  6. Unlevered Beta

    A type of metric that compares the risk of an unlevered company to the risk of the market. The unlevered beta is the beta ...
Trading Center