Kentucky First Federal Bancorp (KFFB) has received approval from Federal Reserve Board to waive its right to receive a dividend.
Kentucky First's members approved the waiver last month, meeting a requirement in the Dodd-Frank Act. But the company's management said at that time that there was no guarantee that the Fed would approve the waiver, given new regulation that had cast doubt on the central bank's position on the issue.
With the approval, Kentucky First will pay a 10-cent cash dividend on Friday to public shareholders. The dividend will be withheld from First Federal MHC, the mutual holding company that is the majority shareholder of Kentucky First Federal.
The $223 million-asset thrift, based in Frankfort and Hazard, said it will continue its regular dividend, with the next payment planned for the end of October. Kentucky First Federal also plans to seek approval for a dividend waiver in 2013, Tony Whitaker, the company's chief executive, said in a press release.