177-C - Investment in mortgage pass-through certificates.

§   177-c.   Investment   in   mortgage   pass-through   certificates.  Notwithstanding the provisions of section one hundred seventy-seven,  or  of  section  one  hundred seventy-eight of this article, the trustees of  any fund may invest in mortgage pass-through certificates.  As  used  in  this  section,  the term "mortgage pass-through certificates" shall mean  certificates evidencing ownership of undivided  interests  in  pools  of  mortgage  loans  secured  by first mortgages on real property located in  this  state  improved  by  one-to-four  family  residential   dwellings,  provided,  however,  that  (i)  such mortgage loans are originated on or  after January first, nineteen hundred eighty by any bank, trust company,  national banking association, savings bank, federal mutual savings bank,  savings and loan association,  federal  savings  and  loan  association,  credit  union, or federal credit union authorized to do business in this  state or by any lender approved by the secretary of  housing  and  urban  development  for  participation  in any mortgage insurance program under  the National Housing Act, (ii) such mortgage loans  are  assigned  to  a  bank,  trust company, federal mutual savings bank or federal savings and  loan association as trustee for the  benefit  of  the  holders  of  such  certificates  and,  (iii)  such  certificates are rated within the three  highest grades by  an  independent  rating  service  designated  by  the  banking  board.  In  no  event  shall  the aggregate unpaid principal on  conventional  mortgages  securing  mortgage  pass-through   certificates  exceed ten percent of the assets of such fund nor shall the total unpaid  principal on any single pool of conventional mortgages securing mortgage  pass-through  certificates  exceed  one percent of the assets of a fund.  Mortgage loans secured by first mortgages on a condominium unit designed  for residential use, together with its common interest, may be  included  in pools of mortgage loans provided for above.