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Financial Institutions Reform, Recovery and Enforcement Act of 1989
(redirected from Financial Institutions Reform, Recovery, and Enforcement Act)

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Financial Institutions Reform, Recovery and Enforcement Act of 1989 (FIRREA)
Legislation that established the Office of Thrift Supervision, which was created in the wake of the savings and loan crisis of the late 1980s.

Financial Institutions Reform, Recovery and Enforcement Act of 1989
Legislation in the United States passed in response to the savings and loan crisis. The FIRREA created the Resolution Trust Corporation, which was charged with closing thrifts declared to be insolvent. It also created new funds within the FDIC to administer the depositor's insurance to account holders at insolvent institutions. Importantly, it created the Office of Thrift Supervision, a bureau of the U.S. Department of the Treasury to regulate federal savings associations, savings and loan associations (thrifts), and some holding companies. The OTS both provides charters and creates regulations for thrifts and other institutions that fall under its supervision. Additionally, it audits the practices of financial institutions that specialize in personal savings and mortgage loans to ensure that they comply with applicable regulations.


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The act allows for the appraisal requirements of Title XI of the Financial Institutions Reform, Recovery, and Enforcement Act and the agencies' appraisal regulations to be waived for up to thirty-six months when the President of the United States determines that a major disaster exists and the agencies determine that such waiver would both facilitate recovery in the disaster area and be consistent with safety and soundness.
25% target set by Congress in the Financial Institutions Reform, Recovery, and Enforcement Act of 1989.
The act was part of a process that began with the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 and included the tightening of bank supervision in 1989, 1990 and 1991.
 
 
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