These Regulations amend the Building Societies (Liquid Asset) Regulations 1991 (the “1991 Regulations”). Part I of the Schedule to the 1991 Regulations sets out the descriptions of assets (“liquid assets”) which a building society may hold for the purposes of meeting its liabilities as they arise. First, these Regulations substitute for the existing paragraph 8 of Part I of the Schedule to the 1991 Regulations a revised description, namely, stock lending rights arising from the lending of securities issued in the United Kingdom by Her Majesty’s Government. This revised description means that building societies may now hold, as liquid assets, rights arising from lending by them of gilt-edged stock to any counterparty, whereas previously the stock had to be lent to a Stock Exchange money broker. As before, however, to qualify as a liquid asset the stock lending right must be secured by the transfer to the society of certain other liquid assets (as specified in paragraph 1 of Part II of the Schedule to the 1991 Regulations). Secondly, these Regulations add a new description of liquid assets, namely, rights arising from the lending under the rules of any depository or clearing agent of any securities which come within paragraph 3, 4 or 7 of Part I of the Schedule and which are recorded in the records of the depository or clearing agent in the name of the society or of any person who holds such securities on the society’s behalf.

A compliance cost assessment of the effect that this instrument would have on the cost of business is available from the Secretary, Building Societies Commission, 15 Great Marlborough Street, London W1V 2LL.