Section 420-K. Termination of insurance

1. Whenever in the opinion of the
  fund any insured savings and loan association has  continued  unsafe  or
  unsound  practices  in  conducting the business of such savings and loan
  association, or has  knowingly  or  negligently  permitted  any  of  its
  officers  or agents to violate any provision of any law or regulation to
  which the insured savings and loan association  is  subject,  said  fund
  shall  first give to the superintendent a statement with respect to such
  practices or violations for  the  purpose  of  securing  the  correction
  thereof  and  shall  give  a  copy  thereof  to  the  savings  and  loan
  association. Unless such correction shall be made within one hundred and
  twenty days or such shorter period of time as the  superintendent  shall
  require,  the fund, if it shall determine to proceed further, shall give
  to the savings and loan association not less than thirty  days'  written
  notice  of  intention  to  terminate  the status of the savings and loan
  association as an insured savings and loan association, and shall fix  a
  time  and  place for a hearing before the fund or a person designated by
  the fund. The fund shall make written findings. Unless the  savings  and
  loan  association  shall  appear  at  the  hearing  by a duly authorized
  representative, it shall be deemed to have consented to the  termination
  of  its  status  as an insured savings and loan association. If the fund
  shall find that any unsafe or unsound practice or violation specified in
  such notice has been established and has not been corrected  within  the
  time  above  prescribed  in  which to make such correction, the fund may
  issue its order  terminating  the  insured  status  of  the  association
  effective  on a date subsequent to such finding and to the expiration of
  the time specified in such notice  of  intention.  The  order  shall  be
  subject  to review under article seventy-eight of the civil practice law
  and rules. In the event of the termination of such status, insurance  of
  its  accounts  to  the extent that they were insured on the date of such
  order  of  termination,   less   any   amounts   thereafter   withdrawn,
  repurchased, or redeemed which reduce the insured accounts of an insured
  member  below  the  amount  insured  on  the  date  of such order, shall
  continue for a period of two years, but no investments or deposits  made
  after  the  date of such order of termination shall be insured. The fund
  shall have the right to examine  such  association  from  time  to  time
  during  the  two-year  period aforesaid.   Such insured savings and loan
  association shall be obligated to pay, within thirty days after any such
  order of termination, as a final insurance premium, a sum equivalent  to
  twice  the  last  annual  insurance  premium  paid  by  it  pursuant  to
  subdivision one of section four hundred twenty-h of this chapter. In the
  event of the termination of insurance of accounts as herein provided the
  savings and loan association which was  the  insured  savings  and  loan
  association  shall give prompt notice in writing sent to all its account
  holders that it has ceased to be an insured savings and loan association
  and it may include in such notice the fact that insured accounts, to the
  extent not withdrawn, repurchased, or redeemed, remain insured  for  two
  years  from  the  date  of  such  termination,  but it shall not further
  represent itself in any manner as an insured association.  In the  event
  of  failure to give the notice to account holders as herein provided the
  fund is authorized to give such notice.
    2. (a) At any time after five years of membership, but not before,  an
  insured   savings  and  loan  association  may  submit  to  the  fund  a
  certificate  of  intention  to   terminate   its   membership   therein.
  Termination  shall  become effective on the first day of the sixth month
  following the submission of the certificate provided that:
    (i) The member pay a termination fee  equivalent  to  twice  the  last
  annual  premium  paid  by it pursuant to subdivision one of section four

  hundred twenty-h of this chapter; this fee shall not extend  or  enlarge
  insurance coverage.
    (ii)  The insured savings and loan association sends to each holder of
  a savings account a notice in writing not later than  two  months  after
  submission  of the certificate; the notice shall be in a form prescribed
  by the fund and shall set forth the facts of the termination.
    (b) The fund may elect to  refund  to  the  association  its  original
  capital  contribution  to  the  fund  subject to terms it may prescribe,
  provided that such refund is made within two  years  of  termination  of
  membership.