Building societies are toasting victory in the wake of a Treasury Select Committee report which could dramatically increase the strength of the mutual sector and prevent further conversions.
The committee's demutualisation report is recommending the 1986 Building Societies Act should be amended to increase the number of borrowers required to push through a conversion vote to 75 per cent from 50 per cent.
The Building Societies Association which has also been strongly campaigning for the voting requirement of borrowers to be brought in line with investors says the proposals will plug a legislative loophole and radically decrease the chances of building societies converting to banks.
The Treasury Select Committee is proposing the recommended legislation to be brought in within the next Parliamentary session which runs between November 1999 and November 2000.
The amended Building Societies Act is likely to be in place before Bradford & Bingley holds its formal conversion vote to be held sometime in 2001.