Silverado Savings and Loan Collapse

The Silverado Savings and Loan collapse was one of the most politically sensitive failures of the broader savings and loan crisis of the 1980s, involving Neil Bush, son of then-Vice President George H.W. Bush. The Denver-based institution failed in December 1988, ultimately costing taxpayers approximately $1.3 billion in federal bailout funds.

Silverado engaged in the high-risk lending practices that characterized the S&L crisis, including speculative real estate development loans and investments in junk bonds. The institution's aggressive growth strategy, fueled by deregulation and federal deposit insurance guarantees, led to massive losses when the commercial real estate market collapsed in the mid-1980s.

Neil Bush served on Silverado's board of directors from 1985 to 1988 while simultaneously conducting business with major Silverado borrowers Kenneth Good and Bill Walters, who received over $130 million in loans from the institution. Bush failed to disclose these conflicts of interest to the board, though he later claimed the relationships were not material to Silverado's lending decisions.

Federal regulators found that Bush had violated conflict-of-interest regulations and issued a cease-and-desist order prohibiting him from similar violations in future banking activities. However, he was not criminally prosecuted, and the Office of Thrift Supervision determined that while his conduct was inappropriate, it did not directly cause Silverado's failure.

The case became politically controversial due to the Bush family connection and the timing of the institution's closure, which occurred just weeks after George H.W. Bush won the 1988 presidential election. Critics argued that regulatory intervention had been delayed to avoid embarrassing the vice president during the campaign, though investigations found no evidence of political interference in the regulatory process.