§ 407. Participation by certain corporations and individuals. 1. One or more banking institutions, foundations, labor unions, employers' associations, veterans' organizations, insurance companies, trustees, fiduciaries or any combination of the foregoing, shall have the power to participate and invest, singly or jointly, with a municipality or the New York city housing development corporation in a bond or note and single participating mortgage, or in separate bonds or notes and mortgages pursuant to and in accordance with the provisions of this article. As used in this section, the terms "trustees" and "fiduciaries" shall include any fiduciary or fiduciaries holding funds for investment.

2. Banking institutions and insurance companies may exercise such power on such conditions as may be prescribed or authorized by the superintendent of financial services.

3. Where one or more banking institutions, foundations, labor unions, employers' associations, veterans' organizations, insurance companies, trustees or fiduciaries participates and invests with a municipality or the New York city housing development corporation as provided in subdivision one, the interest of each need not be equal as to priority of lien, interest rate, time or rate of amortization or otherwise.

4. Where a municipality joins with one or more corporations organizations or individuals of the kind hereinabove mentioned in making a loan secured by a single participating mortgage or by separate mortgages, the municipality may make provision, either in the mortgage or mortgages or by separate agreement, for the performance of such services as are generally performed by a banking institution or insurance company which itself owns and holds a mortgage or by a trustee under a trust mortgage. The agency is hereby authorized to act as trustee or to consent to the appointment of a banking institution to act in such capacity.