What Is the Thrift Institutions Advisory Council?

The Thrift Institutions Advisory Council (TIAC) provided advice and professional opinions to the Federal Reserve regarding the regulation of thrift institutions, primarily mutual savings banks, but also credit unions and savings and loan associations. It was created in 1980 by the Board of Governors of the U.S. Federal Reserve in response to a perceived lack of accurate advice and information on thrift institutions and other establishments that derive the majority of their funds from the savings of the public. The TIAC did not make laws or regulations, but can recommend actions to the Federal Reserve Board.

key takeaways

  • The Thrift Industry Advisory Council was an organization established to advise the Federal Reserve Board regarding the regulation of thrifts, credit unions, and savings and loan associations.
  • Under the Monetary Control Act of 1980, these types of institutions were brought under Federal Reserve regulatory authority and the Fed established the TIAC to help implement such regulation.
  • In 2010, the Fed replaced the TIAC with the Community Depository Institutions Advisory Council, which represents community deposit banks, credit unions, and savings and loans to the regional Fed banks and the Federal Reserve Board.

Understanding the Thrift Institutions Advisory Council

The Thrift Institutions Advisory Council (TIAC) was established by the Board of Governors of the Federal Reserve under the Monetary Control Act of 1980. Under that Act, credit unions and savings and loan institutions were allowed to issue checkable deposit accounts (rather than just savings accounts) to customers, but in return also fell under Federal Reserve regulation like deposit banks do. The TIAC was created to facilitate communication between the Federal Reserve Board and the savings and loan industry and to guide the Federal Reserve in taking actions related to regulating this industry.

The Thrift Institutions Advisory Council was not a statutory body. This means that it did not create statutes, legislation, or regulations on its own, but rather acted in parallel with several other advisory councils in providing first-hand advice and concerns from representatives of institutions with close relationships with the Federal Reserve. The TIAC met three times a year with the Board of Governors of the Federal Reserve in Washington, DC. At this summit, both groups discussed matters of immediate and future concern for the savings industry. The advice of the TIAC was considered pertinent because its members were representatives of mutual savings banks, savings and loan associations, and credit unions, and were expected to operate under the regulations and actions of the Federal Reserve.

In 2010, the Federal Reserve replaced the TIAC with the Community Depository Institutions Advisory Council (CDIAC) to provide input to the Board on the economy, lending conditions, and other issues relevant to small community banks, credit unions, and savings and loans. The CDIAC was established with a more regional structure, with local councils in each of the Federal Reserve districts, which send representative members to a national council meeting with the Federal Reserve Board twice a year.

Composition of the Thrift Institutions Advisory Council

The Thrift Institutions Advisory Council was made up of twelve members, each of whom served for two-year terms. Each member was limited to one term, a rule that was intended to keep the membership body fluid and prevent nepotistic or stagnant conditions on the council. These TIAC members, who were executives of thrift and savings organizations, were appointed and approved by the Federal Reserve Board of Governors itself. It acted in parallel with two other advisory councils, including the Federal Advisory Council, which advises the Federal Reserve and the Board of Governors in a general sense, and the Consumer Advisory Council, which advises on the interests of credit consumers.