Sec. 62.3. Investments by service agencies in urban development projects

A corporation organized under the laws of this State, all of the stock of which is owned by not less than 20 savings banks or all of the stock of which is owned by not less than 20 savings and loan associations or Federal savings and loan associations in New York State (hereinafter referred to as a “service agency”), may invest directly, or through any one or more wholly-owned subsidiary corporations, in the stock of certain corporations and in certain other entities to the following extent:

(a) stock of any other corporation eligible for investment by savings banks under Banking Law, section 235(21)(a)(1) and (1-a);

(b) stock of any other corporation whose bonds, notes or other evidences of indebtedness are eligible for investment by savings banks under Banking Law, section 235(28), the New York State Urban Development Corporation Act, section 23, or the New York State Urban Development and Research Corporation Act, section 18;

(c) stock of any other corporation whose bonds, notes or other evidences of indebtedness are eligible for investment by savings banks under Banking Law, section 235, and which is organized and operated to acquire, construct, reconstruct, rehabilitate, improve, alter or repair or provide for the construction, reconstruction, improvement, alteration or repair of, or sell, lease or otherwise dispose of any “residential”, “industrial”, “land use improvement” or “civic project” or any combination thereof (as such terms are defined in the New York State Urban Development Corporation Act) located in this State which are financed, at least in part, under municipal, State or Federal programs providing grants, tax incentives or other forms of financial assistance, provided that:

(1) the investment in such stock shall not exceed that which a single savings bank would be permitted to make under Banking Law, section 235, or, if a savings bank would not be so permitted to invest in such stock; then

(2) the investment in the stock of any such corporation shall not exceed the lesser of one- tenth of one percent of the assets or one percent of the capital, surplus, undivided profits and reserves of the service agency making such investment and the investment in the stock of all such corporations shall not exceed the lesser of one percent of the assets or 10 percent of the capital, surplus, undivided profits and reserves of such service agency; and

(d) a redevelopment company organized as a partnership or trust as provided by Private Housing Finance Law, section 103(2) and (3), for the purpose of constructing, rehabilitating and operating housing projects and related facilities intended primarily for use by persons of low and moderate income, provided:

(1) the mortgage financing for such project or facility is provided by one or more savings banks directly or through a service agency or its wholly-owned subsidiary;

(2) any such projects or related facilities are financed, at least in part, under municipal, State or Federal programs providing grants, tax incentives or other forms of financial assistance, or under the provisions of section 221(d)(3) or section 236 of the National Housing Act, as amended, or any other provisions of the National Housing Act in effect from time to time permitting Federal insurance of mortgages up to 90 percent of the project value;

(3) the investment in any such entity shall not exceed 10 percent of the total cost of the project for which the entity was formed; and

(4) the investment in all such entities shall not exceed the lesser of five percent of the assets or 50 percent of the capital, surplus, undivided profits and reserves of the service agency making such investments.