Capital One Financial has $36.4 billion of loans outstanding in the three states hardest hit by Hurricane Sandy but says it is too soon to know what percentage those loans are at risk of default as a result of  the property damage.

In a new quarterly filing with the Securities and Exchange Commission, the McLean, Va., company said that it has $19.8 billion of consumer loans and $16.6 billion of commercial loans outstanding in New York, New Jersey and Connecticut.

The $36.4 billion total is equal to nearly 18% of the loans the bank keeps on its books, according to the SEC filing.

Capital One appears to be the first bank to quantify its level of exposure to the storm, which struck the region on Oct. 29 and 30. Several other banks, including Wells Fargo, JPMorgan Chase, Citigroup and Astoria Financial said in 10-Q filings this week that they are still assessing the impact of the storm but did not provide any details on their levels of exposure.

For residential servicers, the storm could affect delinquencies depending on what type of forebearnce is granted by the mortgagee. According to figures compiled by National Mortgage News and the Quarterly Data Report, Wells has a servicing market share of 20.12%, JPM 11.65%, and CitiMortgage 5.37%.

Estimates on property damage caused by the storm range from $20 billion to $50 billion.

In its filing, Capital One said that the storm and its aftermath expose the loans to an “elevated" risk of loss. It added, however, that because Sandy was so recent it is still in the process of evaluating the “extent of the disruption to the individuals, businesses or properties that support our loans. Consequently, it is too early to estimate the potential financial impact on our future earnings.”

Insurance and government support have helped offset losses in past disasters, but Capital One said in the filing that it “cannot give assurance that those historical patterns will apply in this case, particularly given our concentration of commercial real estate exposure in the hardest-hit areas.”

Its level of exposure is highest in New York, where it has $25.4 billion of loans outstanding, more than half of which are commercial loans. (In 2007 Capital One bought Greenpoint Bank, a top-ranked player in the residential market. In 2008 it then purchased Chevy Chase Bank and its B.F. Saul Mortgage division, another significant player in residential finance.)

In Connecticut, Capital One has just under $3 billion of loans outstanding and in New Jersey it has $8 billion. The bulk of those are consumer loans, such as mortgages, car loans and even credit cards.

— Paul Muolo also contributed to this report.


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