Bloomberg News

CIT Says It Can’t Yet Estimate Possible Loss on Train Crash (1)

November 07, 2013

CIT Group Inc. (CIT:US) said it isn’t yet able to estimate its possible losses from the fatal July derailment of a train in Lac-Megantic, Quebec, that included locomotives and tank cars owned by the firm and leased to other companies.

Two of five locomotives in the derailment and nine of 72 tank cars belonged to a CIT subsidiary, the New York-based business lender run by John Thain said yesterday in a filing.

The firm “cannot reasonably estimate the amount or range of loss that may be incurred in connection with the derailment,” because regulatory probes and lawsuits are pending, CIT said. “The company is vigorously defending the claims that have been asserted, including pursuing its rights under indemnification agreements and insurance policies.”

Forty-seven people were killed after a runaway oil train jumped the tracks and burst into flames on July 6. Montreal, Maine & Atlantic Railway Ltd., the train’s operator, said in August that it was forced to file for bankruptcy because of potential liability from the crash. CIT said the two locomotives had been leased to that company.

“The derailment was a tragic event and we extend our sympathies and condolences to all those impacted by the incident,” said Curt Ritter, a spokesman for CIT, in an e-mailed statement. “We do not comment on pending litigation.”

To contact the reporter on this story: Elizabeth Dexheimer in New York at edexheimer@bloomberg.net

To contact the editors responsible for this story: David Scheer at dscheer@bloomberg.net; Peter Eichenbaum at peichenbaum@bloomberg.net


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Companies Mentioned

  • CIT
    (CIT Group Inc)
    • $45.45 USD
    • -0.51
    • -1.12%
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