Board of Governors of the Federal Reserve System

I approve issuing this proposal, which would modernize the regulatory framework applicable to mutual holding companies (MHCs). The proposed regulation contains many useful updates to dated regulations and helps reduce regulatory burden on MHCs.

The Board will benefit from the public's comments. I reserve judgment on the final rule to determine if there are sufficient safeguards on potential conflicts of interest and sufficient accountability for both dividend waivers and conversions. I also hope comments will focus on how new instruments like mutual capital certificates and special deposits might perform as viable loss-absorbing capital under stressed conditions. Finally, I welcome comments about the positive and negative effects of this proposal on competition among entities with different charters and corporate forms.