Section 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.