Security Pacific Financial Services (Rhode Island): First Major Casualty of the 1989 S&L Bailout

During the U.S. Savings & Loan crisis, the federal bailout (FIRREA, 1989) resolved 140+ failed thrifts. Security Pacific Financial Services, Rhode Island Incorporated was the first large institution to collapse in that wave.

Context

• S&Ls failed due to interest-rate mismatch, risky real estate loans, fraud.
• Security Pacific (RI) was a subsidiary of Security Pacific Corp. (LA-based).
• Its failure triggered regulatory scrutiny and accelerated the bailout machinery.
• Assets/liabilities were transferred to the Resolution Trust Corporation (RTC) for liquidation.

The parent, Security Pacific Corp., was later acquired by Bank of America (1992). The RI subsidiary's collapse is a case study in S&L contagion and regulatory response.