Savings and loan associations (S&Ls;), also known as thrifts, are depository institutions serving as major FINANCIAL INTERMEDIARIES. Among all depository institutions, they are second in size of ASSETS only to commercial banks. S&Ls; use funds acquired through savings deposits (often called shares), TIME DEPOSITS, and checkable deposits to make home MORTGAGEs. They are organized as CORPORATIONs and are either state or federally chartered. Previous to 1980, S&L; activities were restricted to offering only savings and time deposits and making only mortgage LOANS. (Checking accounts and consumer loans were offered only by commercial banks.) Because mortgages are typically long-term loans, often with 30-year maturities, and these mortgages had fixed INTEREST RATES (adjustablerate mortgages weren’t popular until the late 1970s), S&L; earnings from mortgage activity suffered greatly in the late 1980s. As the author Frederic S. Mishkin wrote, “When interest rates rose, S&Ls; frequently found that the INCOME from their mortgages was well below the cost of acquiring funds. Many of them suffered large losses, and many went out of business.” In the 1980s, high interest rates and the simultaneous decline of the real-estate market created an S&L; crisis. In 1989 Congress created the RESOLUTION TRUST CORPORATION (RTC), an agency established to manage insolvent thrifts placed in conservatorship or receivership. The RTC seized the ASSETS of about 750 insolvent S&Ls;, comprising over 25 percent of the industry, and sold over 95 percent of them. The subsequent recovery rate was over 85 percent. The RTC sold more than $450 billion of real estate this way, and then went out of business on December 31, 1995. Beginning in 1980, in an effort to put S&Ls; on a more equal footing with commercial banks, Congress passed a series of that expanded S&L; activities, allowing them to offer checking accounts and consumer loans, for example. Today the distinction between S&Ls; and commercial banks is a blurry one, and both types of depository institutions now offer essentially the same intermediary services.