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TeachMeFinance.com - explain operating subsidiary operating subsidiary -- a subsidiary of a federally chartered savings institution that engages only in activities permitted the parent thrift institution. Unlike service corporations, the stock of operating subsidiaries may be sold to non-thrift investors. See service corporations. Copyright © 2005 by Mark McCracken, All Rights Reserved. TeachMeFinance.com is an informational website, and should not be used as a substitute for professional financial or legal advice. TeachMeFinance.com and its owner recommend consultation with a professional financial advisor prior to any investment or financial decision. Please read our disclaimer.