The Federal Reserve has fined two banks for violations of the National Flood Insurance Act.
The $2.2 billion-asset Bank of Hampton Roads in Norfolk, Va., will pay $33,600 as the successor of Gateway Bank and Trust in Elizabeth City, N.C., the Federal Reserve said Thursday. Hampton Roads acquired Gateway in 2009.
The $619 million-asset State Bank and Trust Co. of Defiance, Ohio, will pay $9,340.
Both orders were dated last week. They did not describe the violations. Federal law mandates the purchase of flood insurance for the protection of property located in high-risk areas, and banks have to ensure that loans secured by properties in these areas have the proper coverage. Banks have complained that they bear too much of the enforcement burden.
