The Federal Reserve Board has requested public comments on a proposal to modernize regulations for mutual banking organizations. These institutions, owned by depositors rather than shareholders, comprise over 90 percent of institutions with less than $3 billion in total assets. The rules, first established in 1993 and last updated in 2011, are being revised to address complexity and burdensome requirements. The proposal aims to clarify eligible regulatory capital instruments, reduce procedural burdens, and enhance flexibility for capital-raising while preserving the depositor-owned structure. Comments are due 60 days after publication in the Federal Register. The Board emphasized that maintaining institutional diversity strengthens the U.S. financial system. For media inquiries, contact media@frb.gov or 202-452-2955.
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