§ 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order of termination, less any amounts thereafter withdrawn,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.