Budget Amendment ID: FY2013-S4-245-R1

Redraft ECO 245

Increased Transparency at Mutual Holding Companies

Messrs. Joyce and Montigny and Ms. Jehlen and Mr. Eldridge moved that the proposed new text be amended by inserting at the end thereof the following section:-

“SECTION __.  (a) Chapter 175 of the General Laws is hereby amended by inserting after section 19W the following section:-

Section 19X: (a) A mutual or mutual holding company shall provide clear, concise and understandable disclosure of all compensation awarded to, earned by or paid to the named executive officers or directors designated in subsection (b).  Mutual companies shall conspicuously publish disclosure in a format readily accessible to members.

(b) For the purposes of this section, a “named executive officer or director” shall mean:

(i) a person serving as a company’s principal or chief executive officer or acting in a similar capacity during the last completed fiscal year, the “CEO”, regardless of compensation level;

(ii) a person serving as a company’s principal or chief financial officer or acting in a similar capacity during the last completed fiscal year, the “CFO”, regardless of compensation level;

(iii) a company’s 3 most highly compensated executive officers other than the CEO and CFO who were serving as executive officers at the end of the last completed fiscal year;

(iv) up to 2 additional persons for whom disclosure would have been provided pursuant to clause (iii) but for the fact that the individual did not serve as an executive officer of the company at the end of the last completed fiscal year; and

(v) a company’s directors.

(c) The commissioner of insurance shall further promulgate regulations with the express purpose of requiring a mutual or mutual holding company to provide full and accurate disclosure of:

(i) all compensation to the named executive officers or directors, whether paid or accrued; and

(ii) all conflicts of interest, whether direct or indirect.

(b) Chapter 167 of the General Laws is hereby amended by inserting after section 51 the following section:-

(a) A mutual bank, co-operative bank or credit union shall provide clear, concise and understandable disclosure of all compensation awarded to, earned by or paid to the named executive officers or directors designated in subsection (b).  A mutual bank, co-operative bank or credit union shall conspicuously publish disclosure in a format readily accessible to members.

(b) For the purposes of this section, a “named executive officer or director” shall mean:

(i) a person serving as a company’s principal or chief executive officer or acting in a similar capacity during the last completed fiscal year, the “CEO”, regardless of compensation level;

(ii) a person serving as a company’s principal or chief financial officer or acting in a similar capacity during the last completed fiscal year, the “CFO”, regardless of compensation level;

(iii) a company’s 3 most highly compensated executive officers other than the CEO and CFO who were serving as executive officers at the end of the last completed fiscal year;

(iv) up to 2 additional persons for whom disclosure would have been provided pursuant to clause (iii) but for the fact that the individual did not serve as an executive officer of the company at the end of the last completed fiscal year; and

(v) a company’s directors.

(c) The commissioner of banks shall further promulgate regulations with the express purpose of requiring a mutual bank, co-operative bank or credit union to provide full and accurate disclosure of:

(i) all compensation to the named executive officers or directors, whether paid or accrued; and

(ii) all conflicts of interest, whether direct or indirect.