Explanatory note

The investor protection scheme provided for in the Building Societies Act 1986 gives those who have invested money in a building society which has become insolvent the right to receive a payment from a fund to which all authorised building societies are required to contribute. The amount to which each investor is entitled under the scheme is a proportion (normally 90 per cent) of his protected investment. Subsection (5) of section 27 of the 1986 Act provides that an investor’s protected investment in a society is the total liability of the society to him which is referable to sums deposited with the society or to shares in the society, subject to a specified maximum. This Order amends that subsection so as to increase the maximum from £10,000 to £20,000.