I 

113TH CONGRESS 

2D SESSION H. R. 4252 

To amend the Federal Deposit Insurance Act to allow mutual capital certificates to satisfy capital requirements for mutual depositories, to amend 

the Revised Statutes of the United States to establish mutual national 

banks, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MARCH 14, 2014 

Mr. ROTHFUS introduced the following bill; which was referred to the 

Committee on Financial Services 

A BILL 

To amend the Federal Deposit Insurance Act to allow mutual 

capital certificates to satisfy capital requirements for mutual depositories, to amend the Revised Statutes of the 

United States to establish mutual national banks, and 

for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Mutual Bank Choice 

5 and Continuity Act of 2014’’. 


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1 SEC. 2. TREATMENT OF MUTUAL CAPITAL CERTIFICATES. 

2 (a) IN GENERAL.—Section 38 of the Federal Deposit 

3 Insurance Act (12 U.S.C. 1831o) is amended— 

4 (1) in subsection (b)(2)— 

5 (A) by redesignating subparagraphs (F) 

6 through (I) as subparagraphs (H) through (K), 

7 respectively; and 

8 (B) by inserting after subparagraph (E) 

9 the following new subparagraphs: 

10 ‘‘(F) MUTUAL CAPITAL CERTIFICATE.— 

11 The term ‘mutual capital certificate’ means a 

12 financial instrument issued by a mutual deposi13 tory pursuant to subsection (c)(1)(C) that— 

14 ‘‘(i) is subordinate to all claims 

15 against such mutual depository; 

16 ‘‘(ii) is unsecured by the assets of 

17 such mutual depository; 

18 ‘‘(iii) does not permit preemptive 

19 rights; 

20 ‘‘(iv) does not provide voting or mem21 ber rights to the holder unless the board of 

22 directors of such mutual depository pro23 poses to change the specific terms of any 

24 class of such certificates in a manner ad25 verse to the interests of the holder; 


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1 ‘‘(v) is not eligible for use as collateral 

2 for any loan made by such mutual deposi3 tory; 

4 ‘‘(vi) if declared by the board of direc5 tors of such mutual depository, entitles the 

6 holder to a payment of fixed, variable, or 

7 participating dividends; and 

8 ‘‘(vii) is not redeemable until the date 

9 that is 5 years after the date of issuance, 

10 except in the case of merger, conversion, or 

11 consolidation of such mutual depository, or 

12 reorganization of such mutual depository 

13 into a mutual holding company or a Fed14 eral mutual bank holding company (as 

15 such term is defined in section 5133A(a) 

16 of the Revised Statutes of the United 

17 States). 

18 ‘‘(G) MUTUAL DEPOSITORY.—The term 

19 ‘mutual depository’ means an insured deposi20 tory institution operating in a non-stock form, 

21 including a Federal non-stock depository and 

22 any form of non-stock depository provided for 

23 under State law, the deposits of which are in24 sured by an instrumentality of the Federal Gov25 ernment.’’; and 


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1 (2) in subsection (c)(1)— 

2 (A) in subparagraph (A), by inserting 

3 ‘‘and subparagraph (C)’’ after ‘‘subparagraph 

4 (B)(ii)’’; and 

5 (B) by inserting after subparagraph (B) 

6 the following new subparagraph: 

7 ‘‘(C) MUTUAL CAPITAL CERTIFICATES.—A 

8 mutual depository is authorized to issue mutual 

9 capital certificates that shall qualify as common 

10 equity Tier 1 capital (as such term is defined 

11 by the appropriate Federal banking agency) for 

12 purposes of any capital requirements mandated 

13 by any Federal law or regulation.’’. 

14 (b) REGULATIONS.—Not later than 180 days after 

15 the date of enactment of this section, the appropriate Fed16 eral banking agencies shall jointly issue regulations to im17 plement this section. 

18 SEC. 3. CHARTERING MUTUAL NATIONAL BANKS AND ES19 TABLISHING FEDERAL MUTUAL BANK HOLD20 ING COMPANIES. 

21 (a) IN GENERAL.—Chapter 1 of title LXII of the Re22 vised Statutes of the United States (12 U.S.C. 21 et seq.) 

23 is amended by inserting after section 5133 the following 

24 new sections: 


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1 ‘‘SEC. 5133A. MUTUAL NATIONAL BANKS. 

2 ‘‘(a) DEFINITIONS.—In this section and in section 

3 5133B the following definitions shall apply: 

4 ‘‘(1) APPROPRIATE FEDERAL BANKING AGEN5 CY.—The term ‘appropriate Federal banking agency’ 

6 has the meaning given such term in section 3 of the 

7 Federal Deposit Insurance Act (12 U.S.C. 1813). 

8 ‘‘(2) DEPOSITORY INSTITUTION SUBSIDIARY.— 

9 The term ‘depository institution subsidiary’ means 

10 an insured depository institution that is a subsidiary 

11 (as such term is defined in section 3 of the Federal 

12 Deposit Insurance Act (12 U.S.C. 1813)) of a Fed13 eral mutual bank holding company. 

14 ‘‘(3) INSURED DEPOSITORY INSTITUTION.—The 

15 term ‘insured depository institution’ has the mean16 ing given such term in section 3 of the Federal De17 posit Insurance Act (12 U.S.C. 1813). 

18 ‘‘(4) FEDERAL MUTUAL BANK HOLDING COM19 PANY.—The term ‘Federal mutual bank holding 

20 company’ means a bank holding company operating 

21 in mutual form organized under section 5133B that 

22 owns, directly or indirectly, a majority of the shares 

23 of voting stock of each depository institution sub24 sidiary. 

25 ‘‘(5) MODIFICATION OF A FEDERAL MUTUAL

26 BANK HOLDING COMPANY.—The term ‘modification 


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1 of a Federal mutual bank holding company’ 

2 means— 

3 ‘‘(A) the sale of shares of common or pre4 ferred stock in a depository institution sub5 sidiary to any party other than the parent Fed6 eral mutual bank holding company of such de7 pository institution subsidiary or a wholly 

8 owned subsidiary of that parent; 

9 ‘‘(B) the voluntary grant of a lien on 

10 shares of common or preferred stock in a de11 pository institution subsidiary; or 

12 ‘‘(C) any action that affects the corporate 

13 structure of the Federal mutual bank holding 

14 company and materially impacts the rights of 

15 its members. 

16 ‘‘(6) MUTUAL CAPITAL CERTIFICATE.—The 

17 term ‘mutual capital certificate’ has the meaning 

18 given such term in section 38(b)(2) of the Federal 

19 Deposit Insurance Act (12 U.S.C. 1831o(b)(2)). 

20 ‘‘(7) MUTUAL DEPOSITORY.—The term ‘mutual 

21 depository’ means an insured depository institution 

22 operating in a non-stock form, including a Federal 

23 non-stock depository and any form of non-stock de24 pository provided for under State law, the deposits 


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1 of which are insured by an instrumentality of the 

2 Federal Government. 

3 ‘‘(8) MUTUAL NATIONAL BANK.—The term 

4 ‘mutual national bank’ means a mutual depository 

5 chartered by the Comptroller of the Currency under 

6 this section. 

7 ‘‘(9) MUTUALITY.—The term ‘mutuality’ means 

8 the quality of being an insured depository institution 

9 organized under a Federal or State law providing for 

10 the organization of non-stock depository institutions, 

11 or a holding company organized under a Federal or 

12 State law providing for the organization of non-stock 

13 entities that control one or more depository institu14 tions. 

15 ‘‘(10) NATIONAL BANK.—The term ‘national 

16 bank’ means a banking association organized pursu17 ant to section 5133. 

18 ‘‘(11) MUTUAL MEMBER.—The term ‘mutual 

19 member’ means each tax liable depositor in a mutual 

20 depository’s savings, demand, or other authorized 

21 depository accounts who is not a prior charter mem22 ber. 

23 ‘‘(12) PRIOR CHARTER MEMBER.—The term 

24 ‘prior charter member’ means each tax liable deposi25 tor in a mutual national bank that maintains under 


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1 its prior mutual depository charter pursuant to sub2 section (d)(1)(B). 

3 ‘‘(13) STATE BANK.—The term ‘State bank’ 

4 has the meaning given such term in section 3 of the 

5 Federal Deposit Insurance Act (12 U.S.C. 1813). 

6 ‘‘(14) TAX LIABLE DEPOSITOR.—The term ‘tax 

7 liable depositor’ means the single person responsible 

8 for paying any Federal taxes due on any interest 

9 paid on any deposits held within any savings, de10 mand, or other authorized depository account. 

11 ‘‘(b) CHARTERING MUTUAL NATIONAL BANKS.— 

12 Notwithstanding the provision designated the ‘Third’ of 

13 section 5134, in order to establish mutual institutions op14 erating in non-stock form for the deposit of funds, the ex15 tension of credit, and provision of other services, the 

16 Comptroller of the Currency may charter mutual national 

17 banks either de novo or through a conversion of any in18 sured depository institution or any insured credit union 

19 (as such term is defined in section 101 of the Federal 

20 Credit Union Act (12 U.S.C. 1752)), subject to regula21 tions prescribed by the Comptroller of the Currency in ac22 cordance with this section. The powers conferred by this 

23 section are intended to provide for the creation and main24 tenance of mutual national banks as bodies corporate exVerDate Mar 15 2010 01:57 Mar 21, 2014 Jkt 039200 PO 00000 Frm 00008 Fmt 6652 Sfmt 6201 E:\BILLS\H4252.IH H4252

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1 isting in perpetuity for the benefit of their depositors and 

2 the communities in which they operate. 

3 ‘‘(c) REGULATIONS.— 

4 ‘‘(1) REGULATIONS OF THE COMPTROLLER.— 

5 The Comptroller of the Currency is authorized to 

6 prescribe appropriate regulations for the organiza7 tion, incorporation, examination, operation, and reg8 ulation of mutual national banks. 

9 ‘‘(2) APPLICABILITY OF CAPITAL STOCK RE10 QUIREMENTS.—The Comptroller of the Currency 

11 shall prescribe regulations applicable to mutual na12 tional banks regarding the requirements of this title 

13 with respect to capital stock and the limitations im14 posed on national banks under this title based on 

15 capital stock. 

16 ‘‘(d) CONVERSIONS.— 

17 ‘‘(1) CONVERSION OF A MUTUAL DEPOSITORY

18 TO A MUTUAL NATIONAL BANK.—Subject to such 

19 regulations as the Comptroller of the Currency may 

20 prescribe, a mutual depository that elects to convert 

21 to a mutual national bank shall submit to the Comp22 troller of the Currency a notice of its election to con23 vert on a specified date that is on or after the date 

24 that is 30 days after the date on which the notice 

25 is filed. 


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1 ‘‘(A) CHARTER.—The mutual depository 

2 shall be converted to a mutual national bank 

3 and the Comptroller of the Currency shall issue 

4 a charter described in subsection (b) on the 

5 specified date described in paragraph (1). 

6 ‘‘(B) OPTION TO MAINTAIN MUTUAL DE7 POSITORY CHARTER.—After converting and re8 ceiving a charter under subparagraph (A), such 

9 mutual national bank may continue to exercise 

10 the governance, investments, and authorities 

11 permitted under its prior mutual depository 

12 charter. 

13 ‘‘(2) CONVERSION OF A MUTUAL NATIONAL

14 BANK TO A STOCK NATIONAL BANK.—Subject to 

15 such regulations as the Comptroller of the Currency 

16 may prescribe for the protection of the rights of mu17 tual members and for any other purpose the Comp18 troller of the Currency may consider appropriate, 

19 any mutual national bank may reorganize as a na20 tional bank operating in stock form. 

21 ‘‘(3) CONVERSION OF A MUTUAL NATIONAL

22 BANK TO A STATE BANK.—Any mutual national 

23 bank may convert to a State bank in accordance 

24 with regulations prescribed by the Comptroller of the 

25 Currency and applicable State law. 


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1 ‘‘(e) TERMINATING MUTUALITY.—A mutual national 

2 bank shall terminate mutuality by— 

3 ‘‘(1) liquidating; or 

4 ‘‘(2) converting to a national bank operating in 

5 stock form under subsection (d)(2) or to a State 

6 bank under subsection (d)(3). 

7 ‘‘(f) STATUS AND RIGHTS OF MEMBERS.— 

8 ‘‘(1) IN GENERAL.—The status of a mutual 

9 member or prior charter member is primarily as a 

10 depositor and secondarily as a holder of a contingent 

11 right to participate in the equity of such mutual na12 tional bank upon a liquidation or conversion pursu13 ant to subsection (e). 

14 ‘‘(2) MEMBER RIGHTS.— 

15 ‘‘(A) PRIOR CHARTER MEMBER RIGHTS.— 

16 The status and rights of a prior charter mem17 bers shall be governed by the law of the prior 

18 mutual depository charter. 

19 ‘‘(B) MUTUAL MEMBER RIGHTS.—Each 

20 mutual member of a mutual national bank that 

21 receives a charter pursuant to subsection (b) 

22 shall have the following rights: 

23 ‘‘(i) The right to vote for delegates to 

24 the board of directors of such mutual na25 tional bank. 


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1 ‘‘(ii) The right to attend any meeting 

2 of mutual members called by the board of 

3 directors of such mutual national bank. 

4 ‘‘(iii) Any other rights agreed upon by 

5 contract between the mutual member and 

6 the mutual national bank. 

7 ‘‘(3) CERTAIN VOTING RIGHTS.—On questions 

8 requiring action by its mutual members, the mutual 

9 national bank shall provide in its charter that each 

10 such mutual member shall have either— 

11 ‘‘(A) one vote per mutual member; or 

12 ‘‘(B) one vote for each $100, or fraction 

13 thereof, of the withdrawal value of the mutual 

14 member’s account, but not more than 1,000 

15 votes per mutual member. 

16 ‘‘(4) CONTINUITY OF RIGHTS.—If a mutual na17 tional bank converts to a Federal mutual bank hold18 ing company pursuant to section 5133B, a mutual 

19 member or prior charter member of such mutual na20 tional bank shall have the same rights with respect 

21 to that Federal mutual bank holding company as 

22 such member had with respect to the mutual na23 tional bank immediately prior to such conversion. 

24 ‘‘(5) CONVERSION RIGHTS.—If the board of di25 rectors of a mutual national bank, in its sole discreVerDate Mar 15 2010 01:57 Mar 21, 2014 Jkt 039200 PO 00000 Frm 00012 Fmt 6652 Sfmt 6201 E:\BILLS\H4252.IH H4252

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1 tion, determines that a conversion described in para2 graph (2) or (3) of subsection (d) is in the best in3 terests of the community in which such bank oper4 ates, and the mutual members or prior charter mem5 bers of such bank approve the conversion through a 

6 special proxy, then on a record date set by the board 

7 of directors such members shall have the first right 

8 to subscribe for and purchase stock in the converted 

9 bank. 

10 ‘‘(6) LIQUIDATION RIGHTS.—If a mutual na11 tional bank is liquidated by operation of law, or if 

12 the board of directors of a mutual national bank, in 

13 its sole discretion, determines a liquidation of such 

14 bank is in the best interests of the community in 

15 which such bank operates and the mutual members 

16 or prior charter members of such bank approve the 

17 liquidation, then on the date of liquidation, members 

18 of the liquidated mutual national bank shall have the 

19 right to have credited to their accounts, on a pro 

20 rata basis, any residual assets that remain after the 

21 liquidation of such bank. 

22 ‘‘(g) PROXIES.— 

23 ‘‘(1) IN GENERAL.—A mutual member may give 

24 a perpetual proxy to a committee of the board of di25 rectors of the mutual depository in writing or elecVerDate Mar 15 2010 01:57 Mar 21, 2014 Jkt 039200 PO 00000 Frm 00013 Fmt 6652 Sfmt 6201 E:\BILLS\H4252.IH H4252

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1 tronically. Such proxy may be used to vote on any 

2 issue requiring approval of the mutual members. 

3 ‘‘(2) USE OF PROXIES.—A proxy given under 

4 paragraph (1) may vote on the conversion of a mu5 tual depository to a mutual national bank and any 

6 concurrent or subsequent reorganization to a Fed7 eral mutual bank holding company, except that ab8 sent a finding by the appropriate Federal banking 

9 agency of the mutual depository that action is need10 ed to avoid loss to the Deposit Insurance Fund of 

11 the Federal Deposit Insurance Corporation or to 

12 protect the stability of the United States financial 

13 system, such proxy may not be used to vote in favor 

14 of— 

15 ‘‘(A) terminating mutuality for a mutual 

16 national bank or a Federal mutual bank holding 

17 company; or 

18 ‘‘(B) permitting the modification of a Fed19 eral mutual bank holding company. 

20 ‘‘(3) EFFECT OF CONVERSION OR REORGANIZA21 TION.—A proxy given under paragraph (1) shall 

22 continue to be valid after the conversion of a mutual 

23 depository to a mutual national bank pursuant to 

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1 quent reorganization to a Federal mutual bank hold2 ing company. 

3 ‘‘(4) REVOKING A PROXY.—A mutual member 

4 may revoke a proxy given under paragraph (1) in 

5 writing or electronically. The revocation shall be ef6 fective not later than 6 business days after it is 

7 made. 

8 ‘‘(h) CONFORMING REFERENCES.—Unless otherwise 

9 provided by the Comptroller of the Currency— 

10 ‘‘(1) any reference in any Federal law to a na11 tional bank operating in stock form, including a ref12 erence to the term ‘national banking association’, 

13 ‘member bank’, ‘national bank’, ‘national associa14 tion’, ‘bank’, ‘insured bank’, ‘insured depository in15 stitution’, or ‘depository institution’ shall be deemed 

16 to refer also to a mutual national bank; 

17 ‘‘(2) any reference in any Federal law to the 

18 term ‘board of directors’, ‘director’, or ‘directors’ of 

19 a national bank operating in stock form shall be 

20 deemed to refer also to the board of a mutual na21 tional bank; and 

22 ‘‘(3) any terms in Federal law that may apply 

23 only to a national bank operating in stock form, in24 cluding the terms ‘stock’, ‘share’, ‘shares of stock’, 

25 ‘capital stock’, ‘common stock’, ‘stock certificate’, 


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1 ‘stock certificates’, ‘certificates representing shares 

2 of stock’, ‘stock dividend, transferable stock’, ‘each 

3 class of stock’, ‘cumulate such shares’, ‘par value’, 

4 or ‘preferred stock’ shall not apply to a mutual na5 tional bank. 

6 ‘‘SEC. 5133B. FEDERAL MUTUAL BANK HOLDING COMPA7 NIES. 

8 ‘‘(a) REORGANIZATION OF MUTUAL NATIONAL BANK

9 AS A FEDERAL MUTUAL BANK HOLDING COMPANY.— 

10 ‘‘(1) IN GENERAL.—Subject to approval under 

11 the Bank Holding Company Act of 1956 (12 U.S.C. 

12 1841 et seq.), a mutual national bank may reorga13 nize into a Federal mutual bank holding company by 

14 submitting a reorganization plan to the Board of 

15 Governors of the Federal Reserve System (herein16 after referred to as the ‘Board of Governors’). 

17 ‘‘(2) PLAN APPROVAL.—A reorganization plan 

18 submitted under paragraph (1) requires the approval 

19 of— 

20 ‘‘(A) a majority of the board of directors 

21 of the mutual national bank; and 

22 ‘‘(B) a majority of mutual members or 

23 prior charter members of the mutual national 

24 bank at a meeting held at the call of the board 

25 of directors of such bank under the procedures 


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1 prescribed by the charter or bylaws of such 

2 bank. 

3 ‘‘(3) CONVERSION TO A FEDERAL MUTUAL

4 BANK HOLDING COMPANY.—Upon the approval of 

5 the reorganization plan submitted under paragraph 

6 (1) and the issuance of the appropriate charters— 

7 ‘‘(A) the substantial part of the assets and 

8 liabilities of the mutual national bank, including 

9 all of the insured liabilities, shall be transferred 

10 to a national bank, a majority of the shares of 

11 voting stock of which is owned, directly or indi12 rectly, by the mutual national bank that is to 

13 become a Federal mutual bank holding com14 pany; and 

15 ‘‘(B) the mutual national bank shall be16 come a Federal mutual bank holding company. 

17 ‘‘(b) OWNERSHIP OF DEPOSITORY INSTITUTION SUB18 SIDIARIES.—To avoid terminating mutuality, a Federal 

19 mutual bank holding company must own, directly or indi20 rectly, at least a majority of the shares of voting stock 

21 of each of its depository institution subsidiaries. 

22 ‘‘(c) TERMINATING MUTUALITY.— 

23 ‘‘(1) LIQUIDATING OR CONVERTING.—A Fed24 eral mutual bank holding company shall terminate 


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1 mutuality by liquidating or converting to a bank 

2 holding company operating in stock form. 

3 ‘‘(2) NO TERMINATION.—Notwithstanding 

4 paragraph (1), a reorganization of a mutual deposi5 tory or a modification of a Federal mutual bank 

6 holding company may not terminate mutuality. 

7 ‘‘(d) RETENTION OF CAPITAL.—In connection with 

8 a reorganization described in subsection (a), a mutual na9 tional bank may retain capital at the holding company 

10 level in order to comply with the capital requirements of 

11 the Board of Governors for holding companies. 

12 ‘‘(e) OTHER CONVERSIONS.— 

13 ‘‘(1) CONVERSION OF A STATE MUTUAL BANK

14 HOLDING COMPANY TO A FEDERAL MUTUAL BANK

15 HOLDING COMPANY.—Subject to such regulations as 

16 the Board of Governors may prescribe, a mutual 

17 bank holding company organized under State law 

18 that elects to convert to a Federal mutual bank 

19 holding company— 

20 ‘‘(A) shall submit to the Board of Gov21 ernors a notice of its election to convert on a 

22 specified date that is on or after the date that 

23 is 30 days after the date on which the notice 

24 is filed; and 


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1 ‘‘(B) shall be converted to a Federal mu2 tual bank holding company on such specified 

3 date. 

4 ‘‘(2) MAINTENANCE OF ORIGINAL POWERS, 

5 GOVERNANCE, AND AUTHORITIES.—Upon conversion 

6 to a Federal mutual bank holding company, the enti7 ty may continue to exercise the powers, governance, 

8 and authorities permitted to it as a mutual bank 

9 holding company organized under State law. 

10 ‘‘(3) CONVERSION OF FEDERAL MUTUAL BANK

11 HOLDING COMPANY TO BANK HOLDING COMPANY.— 

12 Subject to such regulations as the Board of Gov13 ernors may prescribe, any Federal mutual bank 

14 holding company that is organized under subsection 

15 (a) may reorganize as a bank holding company oper16 ating in stock form. 

17 ‘‘(f) RIGHTS OF MUTUAL HOLDING COMPANY MEM18 BERS.—Each tax liable depositor in a savings, demand, 

19 or other authorized depository account in depository insti20 tution subsidiary shall have the same rights with respect 

21 to the Federal mutual bank holding company as such de22 positor would have had if the depository institution sub23 sidiary had been a mutual national bank. 

24 ‘‘(g) REGULATION.—A Federal mutual bank holding 

25 company shall be— 


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1 ‘‘(1) chartered by the Board of Governors and 

2 subject to its regulation and supervision; and 

3 ‘‘(2) regulated under the Bank Holding Com4 pany Act of 1956 (12 U.S.C. 1841 et seq.) on terms, 

5 and subject to limitations, comparable to those ap6 plicable to any other bank holding company. 

7 ‘‘(h) CAPITAL IMPROVEMENT.— 

8 ‘‘(1) PLEDGE OF STOCK OF NATIONAL BANK

9 SUBSIDIARY.—This section shall not prohibit a Fed10 eral mutual bank holding company from pledging all 

11 or a portion of the stock of the national bank char12 tered as part of a transaction described in sub13 section (a) to raise capital for such national bank. 

14 ‘‘(2) ISSUANCE OF NONVOTING SHARES.—This 

15 section shall not prohibit a national bank chartered 

16 as part of a transaction described in subsection (a) 

17 from issuing any nonvoting shares or less than 50 

18 percent of the voting shares of such national bank 

19 to any person other than the Federal mutual bank 

20 holding company. 

21 ‘‘(i) INSOLVENCY AND LIQUIDATION.— 

22 ‘‘(1) IN GENERAL.—Notwithstanding any other 

23 provision of law, the Board of Governors may file a 

24 petition under chapter 7 of title 11, United States 


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1 Code, with respect to a Federal mutual bank holding 

2 company upon— 

3 ‘‘(A) the default of any depository institu4 tion subsidiary, the stock of which is owned by 

5 the Federal mutual bank holding company; or 

6 ‘‘(B) a foreclosure on a pledge by the Fed7 eral mutual bank holding company described in 

8 subsection (h)(1). 

9 ‘‘(2) DISTRIBUTION OF NET PROCEEDS.—Ex10 cept as provided in paragraph (3), the net proceeds 

11 of any liquidation of any Federal mutual bank hold12 ing company under paragraph (1) shall be trans13 ferred to persons who hold an interest in such Fed14 eral mutual bank holding company. 

15 ‘‘(3) RECOVERY BY FDIC.—If the Federal De16 posit Insurance Corporation incurs a loss as a result 

17 of the default of any depository institution sub18 sidiary that is liquidated under paragraph (1), the 

19 Federal Deposit Insurance Corporation shall succeed 

20 to the interests of the depositors of the depository 

21 institution subsidiary as members of the Federal 

22 mutual bank holding company to the extent of the 

23 Federal Deposit Insurance Corporation’s loss. 

24 ‘‘(j) CONFORMING REFERENCES.—Unless otherwise 

25 provided by the Board of Governors— 


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1 ‘‘(1) any reference in any Federal law to a bank 

2 holding company operating in stock form shall be 

3 deemed to refer also to a Federal mutual bank hold4 ing company; 

5 ‘‘(2) any reference in any Federal law to the 

6 term ‘board of directors’, ‘director’, or ‘directors’ of 

7 a national bank operating in stock form shall be 

8 deemed to refer also to the board of a Federal mu9 tual bank holding company; and 

10 ‘‘(3) any terms in Federal law that may apply 

11 only to a national bank operating in stock form, in12 cluding the terms ‘stock’, ‘shares’, ‘shares of stock’, 

13 ‘capital stock’, ‘common stock’, ‘stock certificate’, 

14 ‘stock certificates’, ‘certificates representing shares 

15 of stock’, ‘stock dividend’, ‘transferable stock’, ‘each 

16 class of stock’, ‘cumulate such shares’, ‘par value’, 

17 or ‘preferred stock’ shall not apply to a Federal mu18 tual bank holding company unless the Board of Gov19 ernors of the Federal Reserve System determines 

20 that context requires otherwise. 

21 ‘‘(k) LIMITATION ON FEDERAL REGULATION OF MU22 TUAL DEPOSITORIES.—Except as otherwise provided in 

23 Federal law, the Comptroller of the Currency, the Board 

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1 force any regulation that contravenes the corporate mu2 tual governance rules prescribed by State law or regulation 

3 for mutual depositories unless the Comptroller, Board of 

4 Governors, or Corporation finds that the Federal regula5 tion is necessary to assure the safety and soundness of 

6 the mutual depository.’’. 

7 (b) TABLE OF CONTENTS AMENDMENT.—The table 

8 of sections for chapter 1 of title LXII of the Revised Stat9 utes of the United States (12 U.S.C. 21 et seq.) is amend10 ed by inserting after the item relating to section 5133 the 

11 following new items: 

‘‘Sec. 5133A. Mutual national banks. 

‘‘Sec. 5133B. Federal mutual bank holding companies.’’. 

12 (c) APPROPRIATE FEDERAL BANKING AGENCY FOR

13 FEDERAL MUTUAL BANK HOLDING COMPANIES.—Sec14 tion 3(q)(3) of the Federal Deposit Insurance Act (12 

15 U.S.C. 1813(q)(3)) is amended— 

16 (1) in subparagraph (F), by striking ‘‘; and’’ 

17 and inserting a semicolon at the end; 

18 (2) in subparagraph (G), by striking the period 

19 at the end and inserting ‘‘; and’’; and 

20 (3) by inserting after subparagraph (G) the fol21 lowing new subparagraph: 

22 ‘‘(H) supervisory or regulatory proceedings 

23 arising from the authority given to the Board 


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1 of Governors under section 5133B of the Re2 vised Statutes of the United States.’’. 

3 SEC. 4. CONVERSION OF A MUTUAL HOLDING COMPANY TO 

4 A FEDERAL MUTUAL BANK HOLDING COM5 PANY. 

6 (a) IN GENERAL.—A mutual holding company, in7 cluding any form of mutual depository holding company 

8 provided for under State law, may convert to a Federal 

9 mutual bank holding company by filing with the Board 

10 of Governors of the Federal Reserve System a notice of 

11 its election to convert on a specified date that is on or 

12 after the date that is 30 days after the date on which the 

13 notice is filed, and such mutual holding company shall be 

14 converted to a Federal mutual bank holding company on 

15 such specified date. 

16 (b) DEFINITIONS.—In this section the following defi17 nitions apply: 

18 (1) FEDERAL MUTUAL BANK HOLDING COM19 PANY.—The term ‘‘Federal mutual bank holding 

20 company’’ has the meaning given such term in sec21 tion 5133A(a) of the Revised Statutes of the United 

22 States. 

23 (2) MUTUAL HOLDING COMPANY.—The term 

24 ‘‘mutual holding company’’ has the meaning given 


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•HR 4252 IH

1 such term in section 10(o)(10) of the Home Owners’ 

2 Loan Act (12 U.S.C. 1467a(o)(10)). 

Æ 


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