A majority of Utahns believe their money is safer in a bank or credit union than in a savings and loan or thrift and loan, according to a Deseret News/KSL-TV poll conducted by Dan Jones & Associates.
On a scale of one (very unsafe) to seven (very safe), 61 percent of those surveyed said a bank is a very safe place to deposit money, while 50 percent had the same opinion of credit unions.Only 2 percent considered a thrift and loan very safe, while 12 percent didn't know. Savings and loans were believed very safe by just 9 percent of those polled.
On the other end of the scale, 44 percent said deposits in thrift and loans are very unsafe, while 35 percent considered savings and loans very unsafe.
Eight percent considered brokerage firms a very safe place to deposit savings; 23 percent believed brokerages were unsafe; and 27 percent didn't know.
Utah's commissioner of financial institutions, George Sutton, said the poll results didn't surprise him because of publicity about problems the savings and loan and thrift and loan industries have faced during the past four years.
"The only regrettable thing is that people don't believe in the transfer of risk to federal deposit insurers," he said.
All Utah financial institutions, with the exception of security brokerage firms, have their deposit accounts insured up to $100,000 each by a federal insurer. Sutton noted that such agencies are backed by the full faith and credit of the federal government.
"As far as safety is concerned, there is no difference between a bank and a thrift," he said.
But that apparently hasn't dawned on many Utahns, who recall the disastrous 1986 collapse of the state's privately insured thrift and loan industry, when some 15,000 depositors sued the state to recover their lost savings and received a settlement, financed by taxpayers, for about 90 percent of the money.
Even now, the public reads almost daily about failing savings and loans across the country, and Congress grappling with how to pay the $50 billion price tag to remedy the crisis.
"It's we as taxpayers, not depositors, who have something to be concerned about," Sutton said. He explained that many of the thrift and loans in Utah are the largest and healthiest institutions in the state, and some savings and loans are in better shape than some banks.
"It would be interesting to see if the (poll's) results would be the same if each institution was named."
In a breakdown of Jones' survey, those with annual incomes of more than $40,000 led all other income groups in expressing confidence in all financial institutions. However, that same income group included the majority of those who said thrift and loans and brokerage firms are unsafe.
Those showing the least confidence in banks and credit unions earned less than $15,000 a year. The $15,000-$20,000 bracket comprised the majority of those who believe savings and loans are very unsafe.
How would you rate the safety of deposits in the following types of financial institutions, using a 1-7 scale, with 1 being very unsafe and 7 being very safe:
Very 2 3 4 5 6 Very Don't
unsafe safe know
Banks 1% 1% 3% 8% 22% 27% 34% 3%
Credit unions 3% 2% 4% 9% 27% 25% 25% 5%
Savings and loans 20% 15% 17% 16% 16% 5% 4% 6%
Thrift and loans 26% 18% 18% 14% 9% 1% 1% 12%
Brokerage firms 12% 11% 12% 17% 14% 6% 2% 27%
Sample size: 607; margin of error plus or minus 4%