The FHLBB toughened an S&L; investment rule.

In an effort to limit risky investments by weak savings and loan institutions that could endanger their financial stability and the federal deposit insurance fund, the Federal Home Loan Bank Board voted to tighten the rule on direct investments by federally insured S&Ls; in securities, real estate and other types of investments considered riskier than traditional loans. Under the new rule, effective April 16, the amount of direct investment that a thrift will be allowed to make will be tied to its net worth. Formerly, institutions with a relatively low level of net worth could make direct investment up to 10% of net assets without obtaining regulatory approval.