(a) No savings and loan association shall invest in the capital notes or debentures of a service agency if:

1. (1) the aggregate amount of its investment in such notes and debentures, including the proposed investment, would exceed the greater of two percent of the total assets of such savings and loan association as of the date of such investment or $10,000; or
2. (2) the aggregate amount of capital notes and debentures of such service agency then issued and outstanding, including the notes and debentures proposed to be purchased by such savings and loan association would exceed an amount equal to 12 times the issued and outstanding stock, surplus and undivided profits of such service agency.

(b) Nor shall any savings and loan association invest in such capital notes or debentures, unless:

1. (1) such service agency shall have filed with the superintendent its written agreement (and shall have complied with the terms thereof) subjecting itself to the supervision of the department, submitting itself to periodic examinations by the department at such times and in such manner as the superintendent shall provide, and agreeing to pay the charges of such examinations assessed against it by the superintendent in the same manner as if it were a banking organization organized under the laws of New York; and

2. (2) such service agency restricts the investment of its funds to:

   1. (i) investments which savings and loan associations may make under the laws of this State; provided, however, that such service agency may make investments which would be permitted a savings and loan association under section 379(7) of the Banking Law, subject to those limitations applicable to such investments in the case of savings banks, except that the limitations contained in section 235(31)(a) and (b) which restrict certain individual investments to one per centum of the assets of the savings bank or 10 per centum of its net worth, whichever is less, and the aggregate amount of such investments to two per centum of its assets or 20 per centum of its net worth, whichever is less, shall be changed to establish a limitation of an aggregate amount of not to exceed 30 per centum of the service agency's net worth;
   2. (ii) investments in the stock of certain corporations which a service agency may make under section 62.3 of this Title (relating to housing and urban development projects), subject to the limitations thereof;
   3. (iii) bonds and mortgages and notes and mortgages or part interests therein, on improved and unencumbered real property, including leasehold estates, located in New York State or any other State of the United States, the District of Columbia or the Commonwealth of Puerto Rico, which would qualify as investments for savings and loan associations under the laws of this State, except for restrictions governing the locations of the property or the location of the principal office of the holder or any part interest; and
   4. (iv) such other investments as the superintendent shall approve in writing.