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Richard Slynn 22 October 2009

Building Stronger Mutuals. Richard Slynn 22 October 2009. Introduction. Recent consolidation of building societies Advantages of mutuality Challenges in legal and regulatory environment Opportunities to build stronger mutuals. Advantages of mutuality.

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Richard Slynn 22 October 2009

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  1. Building Stronger Mutuals Richard Slynn22 October 2009

  2. Introduction • Recent consolidation of building societies • Advantages of mutuality • Challenges in legal and regulatory environment • Opportunities to build stronger mutuals

  3. Advantages of mutuality • Opportune time to promote mutual values and principles • Key advantages: • relationship with customers • focus on service • one member one vote • long term focus • mutual product pricing • diversity in financial sector • values

  4. Adapting to changing legal and regulatory environment • Challenges from more intrusive regulatory regime • Regulatory capital • Liquidity • Specialist Sourcebook for building societies • Mortgage Market Review • Focus on corporate governance

  5. Butterfill Act • The Building Societies (Funding) and Mutual Societies (Transfers) Act 2007 • Enabling mergers between different types of mutual • Framework • First HMT Order – Mutual Societies (Transfers) Order 2009 • Drafted against background of live transaction

  6. Butterfill Act (cont’d) • Legal mechanics • transfer of business provisions • protective provisions • distribution of funds • membership of holding mutual • no grandfathering of PIBS as Tier 1 capital

  7. Shared operating models • Reforming Financial Markets White Paper • Continental models • Structuring options • Key requirements • Key risks

  8. Other positive developments • Modernising legislation • Opportunities arising from reduced State provision • Positioning to take advantage of current sentiment

  9. These are presentation slides only. The information within these slides does not constitute definitive advice and should not be used as the basis for giving definitive advice without checking the primary sources. Allen & Overy means Allen & Overy LLP and/or its affiliated undertakings. The term partner is used to refer to a member of Allen & Overy LLP or an employee or consultant with equivalent standing and qualifications or an individual with equivalent status in one of Allen & Overy LLP's affiliated undertakings.

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