The broad category of savings institutions is made up of several types of legal structures, including savings banks, building and loan associations, and savings and loan associations. Two of the most distinctive features of savings institutions are their mutual ownership structures and operation as cooperative credit institutions, which exempt them from income taxes paid by commercial banks and other for-profit financial intermediaries.
Savings banks originated in Europe. The first ones in the Western Hemisphere were the Philadelphia Saving Fund Society (opened 1816, chartered 1819) and the Provident Institution for Savings in Boston (chartered 1816). The concept of savings banks originated in the philanthropic motives of the wealthy, who wished to loan funds to creditworthy poor who exhibited the discipline of thrift through their savings behavior. Although savings banks provided a safe haven for small accounts, it is doubtful that these banks made many loans to the poor.
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