New York names 'bottom 10' banks sitting on Sandy insurance money
NEW YORK, March 19
NEW YORK, March 19 (Reuters) - New York State governor Andrew Cuomo has named 10 banks, including Capital One Financial Corp and SunTrust Banks Inc, that he says are sitting on $41 million in insurance money owed to victims of Superstorm Sandy, which hit the northeastern United States last year.
The naming of what Cuomo describes as the "bottom ten banks" comes a month after he ordered the state's financial watchdog to investigate three insurance companies he said were being too slow in settling claims with Sandy victims
The storm caused around $40 billion of damage in New York State and impacted millions of people. Loss of property tax revenues, emergency funds and hefty repair bills have put an additional strain on the stretched municipal finances throughout the state, despite aid from the federal government.
"Some banks have continued to lag especially far behind the rest and it's well past time for them to pick up the pace," Cuomo said in statement on Tuesday.
An investigation by the state's watchdog, the Department of Financial Services (DFS), reviewed 33 banks and mortgage servicers. The report found the bottom 10 banks were holding back 44 percent of the insurance claims they received compared with an industry-wide average of 17 percent.
The 10 banks are holding back 1,109 checks, the statement said. One of them, Selene Financial, was holding back 71 percent of the Sandy funds it received, according to the report.
Insurance checks are issued jointly to homeowners and their banks, which means the institutions need to sign off before any money is paid out.
Flagstar Bank, which was named among the bottom 10, declined to comment. The other institutions did not immediately respond to requests for comments.
The other six banks or mortgage providers named by Cuomo were Select Portfolio, Astoria Federal, Nationstar Mortgage, Specialized Loans, OneWest Bank and Mid-Island Mortgage.
By comparison, the DFS report showed that three of the nation's largest banks - Citigroup Inc, JPMorgan Chase and Bank of America Corp - have payed out more than 89 cents of every dollar received.
The banks the DFS examined have paid out in excess of $1.1 billion in Sandy insurance claims, the report added.
Trending On Reuters
We are living longer but not creating financial plans to keep pace. Advisers give tips on how to make sure you don’t outlive your money. Video