Managers of mutual savings banks who are considering forming a mutual holding company should not be dissuaded by the March action of the Federal Deposit Insurance Corp. that prohibited mutual holding companies from waiving dividends for the benefit of minority shareholders.

In a mutual holding company conversion, a mutual savings bank converts to stock ownership. A mutual holding company is formed, and it is issued a majority stake in the new, stock-owned bank. Investors purchase a minority stake in the bank.

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