SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Mutual Bank Capital Opportunity Act 
of 2017''.

SEC. 2. TREATMENT OF MUTUAL CAPITAL CERTIFICATES.

    (a) In General.--Section 38 of the Federal Deposit Insurance Act 
(12 U.S.C. 1831o) is amended--
            (1) in subsection (b)(2)--
                    (A) by redesignating subparagraphs (F) through (I) 
                as subparagraphs (H) through (K), respectively; and
                    (B) by inserting after subparagraph (E) the 
                following new subparagraphs:
                    ``(F) Mutual capital certificate.--The term `mutual 
                capital certificate' means a financial instrument 
                issued by a mutual depository pursuant to subsection 
                (c)(1)(C) that--
                            ``(i) is subordinate to all claims against 
                        such mutual depository;
                            ``(ii) is unsecured by the assets of such 
                        mutual depository;
                            ``(iii) does not permit preemptive rights;
                            ``(iv) does not provide voting or member 
                        rights to the holder unless the board of 
                        directors of such mutual depository proposes to 
                        change the specific terms of any class of such 
                        certificates in a manner adverse to the 
                        interests of the holder;
                            ``(v) is not eligible for use as collateral 
                        for any loan made by such mutual depository;
                            ``(vi) if declared by the board of 
                        directors of such mutual depository, entitles 
                        the holder to a payment of fixed, variable, or 
                        participating dividends; and
                            ``(vii) is not redeemable until the date 
                        that is 5 years after the date of issuance, 
                        except in the case of merger, conversion, or 
                        consolidation of such mutual depository, or 
                        reorganization of such mutual depository into a 
                        mutual holding company or a Federal mutual bank 
                        holding company (as such term is defined in 
                        section 5133A(a) of the Revised Statutes of the 
                        United States).
                    ``(G) Mutual depository.--The term `mutual 
                depository' means an insured depository institution 
                operating in a non-stock form, including a Federal non-
                stock depository and any form of non-stock depository 
                provided for under State law, the deposits of which are 
                insured by an instrumentality of the Federal 
                Government.''; and
            (2) in subsection (c)(1)--
                    (A) in subparagraph (A), by inserting ``and 
                subparagraph (C)'' after ``subparagraph (B)(ii)''; and
                    (B) by inserting after subparagraph (B) the 
                following new subparagraph:
                    ``(C) Mutual capital certificates.--A mutual 
                depository is authorized to issue mutual capital 
                certificates that shall qualify as common equity Tier 1 
                capital (as such term is defined by the appropriate 
                Federal banking agency) for purposes of any capital 
                requirements mandated by any Federal law or 
                regulation.''.
    (b) Regulations.--
            (1) Implementation.--Not later than 180 days after the date 
        of the enactment of this section, the appropriate Federal 
        banking agencies (as defined in section 3 of the Federal 
        Deposit Insurance Act (12 U.S.C. 1813)) shall jointly issue 
        regulations to implement this section.
            (2) Other financial instruments.--
                    (A) In general.--Not later than 90 days after the 
                date of the enactment of this section, the appropriate 
                Federal banking agencies shall jointly issue 
                regulations identifying other financial instruments, 
                aside from mutual capital certificates, that mutual 
                depositories may issue that shall qualify as additional 
                Tier 1 capital (as such term is defined by the 
                appropriate Federal banking agency) for purposes of any 
                capital requirements mandated by any Federal law or 
                regulation.
                    (B) Definitions.--The terms ``mutual capital 
                certificate'' and ``mutual depository'' have the 
                meaning given such terms in section 38(b)(2) of the 
                Federal Deposit Insurance Act (12 U.S.C. 1831o(b)(2)).
    (c) Report to Congress.--Not later than 6 months after the date of 
the enactment of this section, and every 6 months thereafter until the 
date which is 3 years after the date of the enactment of this section, 
the appropriate Federal banking agencies shall submit a report to 
Congress on the progress of such agencies in promulgating the 
regulations described in subsection (b). Such report shall include a 
description of outreach efforts to the financial industry and any 
barriers to implementation of the requirements of this section.
Output: Mutual Bank Capital Opportunity Act of 2017 This bill amends the Federal Deposit Insurance Act to allow mutual capital certificates issued by&nbsp;a mutual depository&nbsp;(i.e., a federally insured depository institution operating in a non-stock form)&nbsp;to qualify as common-equity Tier 1 capital for purposes of&nbsp;satisfying federal&nbsp;capital requirements. A&nbsp;"mutual capital certificate" is&nbsp;a financial instrument that: (1) is subordinate to all claims against, and unsecured by the assets of,&nbsp;the issuing mutual depository; (2) does not permit preemptive rights; (3) in general, does not provide voting or member rights; (4) is not eligible for use as collateral for any loan made&nbsp;by the issuing mutual depository; (5)&nbsp;entitles the holder to a payment of fixed, variable, or participating dividends (if the depository's board so declares); and (6)&nbsp;is generally not redeemable until five years after issuance. The appropriate federal banking agencies must jointly issue regulations to implement these provisions and to identify other financial instruments issued by mutual depositories that shall qualify as additional Tier 1 capital for purposes of federal capital requirements. The agencies must submit to Congress a series of reports on their progress in promulgating such regulations.