S&L were forced to be focused on long-term residential loans and to offer a vulnerable, narrow savings product offering and weren't allowed to significantly diversify with other kinds of lending.

Calling it an emphasis makes it sound like an S&L could've just started looking like any diversified bank to stay alive, but it wasn't an option for them without a change to their regulatory environment--and couldn't have happened quickly enough anyway once the crisis was rolling.

If unchecked, the interest rate changes at the time would've eventually come for all banking, but the damage was limited.