Part II Incorporated Friendly Societies

Powers of incorporated friendly societies

14 Investment of funds.

(1)

An incorporated friendly society may invest its funds—

(a)

in the purchase of land, or in the erection of offices or other buildings thereon;

(b)

upon any other security expressly directed by the rules of the society, other than personal security (but without prejudice to any provision of this Act relating to loans); or

(c)

in any other investment of a kind which trustees are for the time being by law authorised to make.

(2)

An incorporated friendly society which falls within subsection (3) F1. . . below may also invest the funds of the society in any other manner authorised by its constitution.

(3)

An incorporated friendly society falls within this subsection if—

(a)

it is a society to which F2rules in respect of margins of solvency, made by the F3appropriate authority under Part 9A of the Financial Services and Markets Act 2000, apply and

(b)

it maintains the margin of solvency which it is required to maintain by virtue of F4such rules.

F5(4)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(5)

Once a society falls within subsection (3) F1. . . above, it shall be treated as continuing to do so for the purposes of subsection (2) above unless the F6appropriate authority serves a notice under subsection (6) below on it.

(6)

Where it appears to the F7appropriate authority that an incorporated friendly society has ceased to fall within subsection (3) F1. . . above, it shall serve on the society a notice stating that fact.

(7)

The powers of investment of a society on which a notice is served under subsection (6) above shall accordingly, until the notice is revoked under subsection (10) below, be limited to investment falling within subsection (1) above.

(8)

A notice under subsection (6) above may direct a society to dispose of an investment which it could not have acquired except under subsection (2) above.

(9)

Subject to subsection (8) above, a society may retain any investment which it could only have acquired under subsection (2) above.

(10)

The F8appropriate authority may, by a subsequent notice to the society, revoke a notice under this section at any time when it appears to it that the society again falls within subsection (3) F1. . . above.

F9(10A)

The PRA must send to the FCA a copy of any notice it serves under subsection (6) or (10).

F10(11)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(12)

The F11FCA shall keep a copy of F12any notice served on a society under subsection (6) or (10) above in the public file of the society.