The Building Societies (Designation of Qualifying Bodies) Order 1992

Explanatory Note

(This note is not part of the Order)

1.  This Order designates a description of body corporate as suitable for investment and support by building societies under section 18 of the Building Societies Act 1986, so as to add “appropriate lending vehicle” as a further type of designated body.

2.  An appropriate lending vehicle is a body corporate (not being one excluded by the particular restrictions for appropriate lending vehicles) formed for the purposes of or the objects of which include acquiring, holding and disposing of debts which are secured on land in the United Kingdom or in any country or territory for the time being designated by Order under section 14 of the Act and making advances on the security of such land, including making advances indirectly secured on such land.

3.  The particular restrictions for appropriate lending vehicles are that a body corporate is not an appropriate lending vehicle for a society where: it is a market maker; its business includes activities the society itself has no power to undertake either because the society has not adopted the necessary adoptable power or because the activities would contravene a restriction on the extent of a power which the society has adopted.

4.  Investment is defined by section 18 of the Act as acquiring and holding shares or corresponding membership rights in and forming and taking part in forming bodies corporate. Support is defined by that section as provision of loans, grants, guarantees, services or property to bodies corporate.