bank's profitability in the financial crisis of 2007-2009
Defaults on subprime mortgage triggered this financial crisis.
Finance companies that specialized in subprime lending suffered huge losses, as did investment banks that held large quantities of securities backed by subprime mortgage.
largely because of government regulation, commercial banks and savings institutions had less exposure to these mortgages.
they made few subprime loans and were not allowed to hold the riskiest mortgage backed securities.
these restrictions limited their losses from the bursting of the housing bubble and rising mortgage defaults.