P.M. BRIEFING : S&L; Buyer Defends Purchase
Businessman James Fail, who bought 15 failed Texas savings and loans with only $1,000 of his own money, told Congress today that the deal was saving American taxpayers hundreds of millions of dollars.
Fail told a Senate Antitrust subcommittee hearing that the thrifts were losing $2 million a day before he bought them in 1988 and combined them into the profitable Bluebonnet Savings Bank of Dallas.
“Bluebonnet already was saving the American taxpayer over $100 million as compared with continuing the operations of the 15 insolvent thrifts,” Fail testified. He said liquidating the thrifts would have cost the government $600 million.
“Bluebonnet is part of the solution to the savings and loan crisis, not a part of the problem,” Fail added. He also owns several insurance companies and a bank in Oklahoma in addition to Bluebonnet.
Chairman Howard M. Metzenbaum (D-Ohio) countered that Bluebonnet was profitable only because of billions of dollars in federal subsidies.
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