Current through Register Vol. 48, No. 38, September 20, 2024
a) No subsidiary savings bank may declare or
pay a cash dividend on or repurchase any of its capital stock unless the
declaration or payment of the dividend or repurchase would be in accordance
with the requirements of Section 5008 of the Act and would not reduce the
capital of the converted savings bank below the greatest of:
1) the amount required for the liquidation
account;
2) the amount required by
the Director; or
3) the amount
required by federal law.
b) A converted mutual savings bank may pay
dividends on preferred stock at the rate or rates agreed in connection with the
issuance of preferred stock, if such issuance has been approved by the
Director. However, the Director shall approve no issuance or payment that would
reduce the capital of the converted savings bank below the greatest of:
1) the amount required for the liquidation
account;
2) the amount required by
the Director; or
3) the amount
required by federal law.
c) No mutual holding company may waive its
right to receive any dividend declared by a subsidiary unless:
1) No insider of the mutual holding company,
associate of an insider, or tax-qualified or non-tax-qualified employee stock
benefit plan of the mutual holding company holds any share of stock in the
class of stock to which the waiver would apply; or
2) The mutual holding company provides the
Director with written notice of its intent to waive its right to receive
dividends 30 days prior to the proposed date of payment of the dividend and the
Director does not object. The Director shall not object to a notice of intent
to waive dividends if:
A) the waiver would not
be detrimental to the safe and sound operation of the savings bank;
and
B) the board of directors of
the mutual holding company expressly determines that waiver of the dividend by
the mutual holding company is consistent with the organization directors'
fiduciary duties to the mutual members of the company. A dividend waiver notice
shall include a copy of the resolution of the board of directors of the mutual
holding company, in form and substance satisfactory to the Director, together
with any supporting materials relied upon by the board, concluding that the
proposed dividend waiver is consistent with the board's fiduciary duties to the
mutual members of the mutual holding company.
