{
  "url": "https://openlegislation.uk/building-societies-designated-capital-resources-permanent-interest-bearing-shares-order-1991/article-4",
  "json_url": "https://openlegislation.uk/building-societies-designated-capital-resources-permanent-interest-bearing-shares-order-1991/article-4.json",
  "legislation": "uksi/1991/702",
  "legislation_title": "The Building Societies (Designated Capital Resources) (Permanent Interest Bearing Shares) Order 1991",
  "legislation_url": "https://openlegislation.uk/building-societies-designated-capital-resources-permanent-interest-bearing-shares-order-1991",
  "path": "article/4",
  "kind": "article",
  "number": "4",
  "heading": "Capital resources which may be aggregated with reserves",
  "text": "(1) Where a society has issued permanent interest bearing shares denominated in sterling, the amount paid up on those shares, or credited as paid up thereon by the application of reserves, may, subject to paragraph (2) of this article and to articles 5 and 6 below, for the purposes of the first criterion be aggregated with reserves.\n(2) In the case of a society which is not authorised, the amount paid up on permanent interest bearing shares aggregated with reserves for those purposes shall not when taken together with any shares aggregated pursuant to Article 3 above exceed the authorised sum.\n(3) In this article “permanent interest bearing shares” means shares which are –\n(a) shares of a class defined by the Building Societies (Deferred Shares) Order 1991 as a class of shares defined as deferred shares for the purposes of section 119 of the Act;\n(b) issued upon issue terms which provide for payment, subject to terms which have the effect of the prescribed terms, in respect of such periods as may be specified in the issue terms, of interest at a rate so specified which shall be\n(i) a fixed rate;\n(ii) a stepped rate; or\n(iii) a floating rate\nbut which shall not be ascertained by reference to the profits of the society or any other factor other than a market rate;\n(c) issued upon issue terms which have the effect of the prescribed terms without other terms or with only such other terms as are not inconsistent with the prescribed terms, and\n(d) are not issued upon issue terms which have the effect of either of the disqualifying terms.\n(4) In this article–\n“a fixed rate” means a rate of interest which remains the same for so long as the shares remain outstanding;\n“a stepped rate” means a rate of interest which increases or reduces from time to time by steps specified in time and amount;\n“a floating rate” means a rate of interest which is ascertained by reference to a specified market rate or by reference to a specified market rate varied by a specified margin;\n“a market rate” means\n(a) a rate being one of, or an average of, any published rates of interest applicable from time to time for the purpose of calculating interest on debt or other financial obligation arising from transactions between institutions which are authorised for the purposes of the Banking Act 1987;\n(b) a rate one of, or an average of, any published rates of interest applicable from time to time for the purpose of calculating interest payable on any class of securities issued in the United Kingdom by Her Majesty’s Government;\n(c) the rate of interest payable on such interest bearing shares in the society as have from time to time the lowest rate of interest; or\n(d) the rate of interest payable on such interest bearing shares in the society as have from time to time the highest rate of interest.",
  "extent": null,
  "status": null,
  "version": "current",
  "annotations": [
    {
      "type": "footnote",
      "label": "f1",
      "text": "S.I. 1991/701."
    }
  ],
  "outstanding_effects": [
    {
      "type": "modified",
      "affecting": "uksi/1992/3218",
      "affecting_title": "The Banking Coordination (Second Council Directive) Regulations 1992 (revoked)"
    }
  ],
  "provenance": {
    "source": "legislation.gov.uk",
    "source_url": "https://www.legislation.gov.uk/uksi/1991/702/article/4",
    "retrieved_at": "2026-10-29T14:47:48.125163+00:00"
  },
  "licence": "Open Government Licence v3.0",
  "licence_url": "https://www.nationalarchives.gov.uk/doc/open-government-licence/version/3/",
  "attribution": "Contains public sector information licensed under the Open Government Licence v3.0. Source: legislation.gov.uk, The National Archives."
}