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Mutual holding companies appear to be fleeing the format and converting to stock companies, but Northeast Community CEO Kenneth Martinek remains a staunch supporter of the model. That may be partly because he's being sued by an activist investor who is pushing him to convert Northeast to a stock company from an MHC.
August 23 -
Some analysts believe the time is ripe for second-step conversions by mutual holding companies. Still, some bankers believe the floodgates will remain closed until regulators decide to let MHCs pay a special dividend before converting.
April 17
The mutual holding company for Northeast Community Bancorp (NECB) will ask its members to waive their right to receive dividends from the White Plains, N.Y., company.
Members of NorthEast Community Bancorp, MHC, which owns 57.5% of the company's outstanding common stock, will vote in November on whether to waive receiving annual dividends of up to 12 cents per share during the next 12 months.
The company has delayed declaring its quarterly cash dividend pending the vote, Northeast said Friday. If members okay the waiver, it still has to be approved by the Federal Reserve.
In general, waiving the dividend to a mutual holding company would allow the company to pay higher dividends to its public shareholders.
As required by the Dodd-Frank Act, the Fed previously issued a regulation that requires mutual holding companies to obtain approval from members for dividend waivers. But there still remains uncertainty in the mutual-thrift industry about the Fed's position on the matter. The regulator
