Covered Savings Associations: A New Type of Depository Institution

The Economic Growth, Regulatory Relief, and Consumer Protection Act of 2018 allowed some federally chartered savings associations to elect to operate with the powers of a national bank, expanding their ability to engage in commercial banking activities and no longer requiring them to concentrate their activities in residential mortgage lending. This Economic Commentary describes which associations have made the election, their reasons for doing so, and how the election has changed their asset mix. Both mutual and stock savings associations have made this election, and among mutuals, large institutions are especially likely to have done so. Institutions that have made this election have altered their asset mix away from residential lending and toward that of similarly sized national banks.