) -- The U.S. savings and loans industry has essentially been eliminated with last week's announcement by the Federal Reserve of

proposed new capital requirements for banks

, according to a report published Monday by financial services-focused investment bank Keefe, Bruyette & Woods.

Some trappings of the industry may remain, such as an official thrift charter or institutions with "savings and loan" in their name. However, the things that made thrifts unique - -a focus on variable rate, residential real estate lending and lower capital requirements -- are all a thing of the past, KBW's analysts write.

Washington Mutual and Golden West Financial, which had been the largest thrifts before the crisis, are gone, and no thrift today has more than $100 billion in assets. What's more, they have stronger balance sheets and are less focused on residential real estate than pre-crisis thrift, according to KBW.

The disappearance of thrifts, according to KBW, means increased opportunities for banks and mortgage real estate investment trusts such as

Annaly Capital Management

(NLY) - Get Report


"We expect the market cap of non-bank mortgage lenders to increase significantly over the next decade," KBW analysts write in their report.

Banks, meanwhile, will find it more profitable to sell standardized "conforming" loans to government sponsored enterprises

Fannie Mae



Freddie Mac


, while charging more for variable rate loans, according to KBW.

KBW analysts predict this will make it still more difficult to reduce the role of Fannie and Freddie in mortgage lending, a stated goal of both Democrats and Republicans that nonetheless

is seeing little progress.


Written by Dan Freed in New York


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