(1) A building society shall not enter into an arrangement -

(a) whereby a director of the society or a person connected with such a director acquires or is to acquire one or more non-cash assets of the requisite value from the society; or

(b) whereby the society acquires or is to acquire one or more non-cash assets of the requisite value from such a director or a person so connected;

unless the arrangement is first approved by a resolution of the society in general meeting.

(2) For the purposes of this section a non-cash asset is of the requisite value if at the time the arrangement in question is entered into its value is not less than £50,000 or, in the case of a society with reserves of less than £500,000, is not less than 10 per cent. of the reserves.

(3) In this section "non-cash asset" means any property or interest in property other than cash and for this purpose "cash" includes foreign currency; and a reference to the acquisition of a non-cash asset includes a reference to the creation or extinction of an estate or interest in, or a right over, any property and also a reference to the discharge of any person's liability other than a liability for a liquidated sum.