Kentucky First Federal Bancorp (KFFB) is seeking to waive its right to receive a dividend despite lingering uncertainty as to whether regulators will allow mutual holding companies to make that move.
The $223 million-asset company, based in the state capital of Frankfort and Hazard, will pay a 10-cent cash dividend on Sept. 28 to shareholders. Members of First Federal MHC, the mutual holding company that's the majority shareholder of Kentucky First Federal, voted in favor of the dividend waiver.
Kentucky First said it will submit the vote results to the Federal Reserve Board for final approval. The Fed had previously issued a regulation, as required by the Dodd-Frank Act, requiring MHCs to obtain member approval for dividend waivers. But there remains uncertainty in the mutual-thrift industry about the Fed's current position on the matter.
"While management believes that, with the positive member vote, all requirements of the Federal Reserve's Regulation MM have been fulfilled, there can be no guarantee that they will approve the waiver," Kentucky First Federal said in a press release Thursday.
Kentucky First last week said that its chief executive, Tony Whitaker, will step down from that position at the end of the year.