The Building Societies (Insolvency and Special Administration) Order 2009

EXPLANATORY NOTE

(This note is not part of the Order)

This Order applies Parts 2 (Bank Insolvency) and 3 (Bank Administration) of the Banking Act 2009 (c.1) (“the Banking Act”) in relation to building societies.

Articles 2 to 11 make substantive and consequential amendments to the Building Societies Act 1986 (c.53), including a new section 90C which applies Parts 2 and 3 of the Banking Act in relation to building societies. Parts 2 and 3 apply with the modifications specified in that section and in Schedule 1. In particular, the procedures in Parts 2 and 3 as they apply in relation to building societies are termed “building society liquidation” and “building society special administration”.

Articles 12 to 15 make amendments to other enactments in connection with the disqualification of directors, insolvency rules and the Financial Services Compensation Scheme. These replicate amendments made by Parts 2 and 3 of the Banking Act.

Articles 16 to 18 and Schedule 2 deal with the procedure for making rules, application of the Order to Northern Ireland and the application (with modifications) of subordinate legislation made under Parts 2 and 3 of the Banking Act to building societies.

Schedule 1 sets out further modifications to Parts 2 and 3 of the Banking Act as they apply in relation to building societies. Part 1 sets out general modifications relating to interpretation. Part 2 sets out modifications relating to building society insolvency. Part 3 sets out modifications relating to building society special administration.

An impact assessment of the effect of the Banking Act 2009 is available on HM Treasury’s website (www.hm-treasury.gov.uk).