Detail from the history of US home financing

Here's a passage from the book Fixing the Housing Market, by Franklin Allen at al.

In chapter 2, the authors are engaged in some historical stage setting. They write that a major result of the 1890s economic downturn in the U.S. was "the virtual elimination of the so-called national institutions [in the building-and-loan market.]. This type of institution developed in the 1880s by gathering deposits and making mortgage loans on a national scale through the use of branch offices and the mail. Although the downturn of the 1890s hit both nationally based and locally based institutions, local associations attributed their problems to the improper loan strategy and subsequent failures of the national institutions. They claimed that customers were unable to distinguish between the two types of firms during the panic of 1893. The increased competition engendered by the nationals also led to the establishment of the US.League of Local Building and Loan Associations. This group became very influential during the subsequent years and successfully lobbied the state legislature to curb the acrtivities of the national associations, a move that eventually drove the nationals out of business."