September 5, 1988 brought one of the costlier episodes of the Savings and Loan crisis: backed by $2 billion in Federal aid, the Robert M. Bass Group signed off on a deal to acquire the nation's largest bankrupt thrift, American Savings and Loan Association. The bailout had in fact been brewing for some time. In 1984, the Stockton, California-based thrift reported a whopping 2nd quarter loss of $107.5 million, which triggered a $6.8 billion run on deposits. Despite adopting an aggressive strategy to stem the losses, American Savings and Loan continued to flounder. With the thrift clearly in trouble, several buyers appeared, including the Ford Motor Corp. However, the Federal Home Loan Bank Board, which brokered the deal, shut the automaker out and opted to give the Bass Group and its reclusive billionaire chairman an exclusive shot at American Savings and Loan. The result was the most expensive bailout ever for a single Savings and Loan institution.
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