The heads of two mega unions of New York City said last Wednesday (9th February) they would go ahead with pushing for pension funds to sell off stocks and bonds in Chase if the bank failed to help the troubled house owners trying to avoid foreclosure.

These announcements were included in the campaign programme of New York Communities for Change to compel the banks to modify greater number of mortgages.

The executive director of the group Jon Kest said that they had singled out Chase because it dealt with the servicing of huge number of mortgages in New York City; the bulk of the applications for loan modification had been refused by Chase and not given a permanent status.

In the forthcoming weeks Kest said that the officials of the unions together with religious and community heads would put pressure on other investors to withdraw their assets from Chase. Weekly protests would be staged in front of the Manhattan headquarters of the bank.

The president of Transport Workers Union Local 100, John Samuelsen, that represents the transit workers of the city together with the president of United Federation of Teachers, Michael Mulgrew said trustees of pension funds would be urged by them to sell off all holdings in Chase if the bank did not start permanently modifying loans of more troubled borrowers facing foreclosure.

Nearly $40 million from Teacher's Retirement System and $40 billion in pension fund has been invested with JPMorgan Chase. The transit workers have their pension deposits covered by New York City Employee's Retirement System funds; it has $271 million as stocks and bonds of Chase out of assets of $39 billion.

Whether the pension boards will be swayed successfully by this move of the union leaders remain uncertain. The board comprises of representatives from both the government and the union.

As per a Treasury report of December regarding the loan modification programme that pays the banks for modifying mortgages by bringing down interest rates, principal and or extension of the loan terms, Chase modified permanently 34% of the mortgage loans that were in trouble. This group was eligible for permanent modification. Other banks too approximately modified the same proportion of loans.

Kest says that a mere 6% of the 1,027 house owners who had applied for modification from 2008 July and 2010 December were able to be permanently benefit.

The bank said they have been weighed down by exorbitant numbers of troubled mortgages since taking over Washington Mutual. However it is doing its best to help the borrowers and correct mistakes.