We use cookies to provide you with a better experience. If you continue to use this site, we'll assume you're happy with this. Alternatively, click here to find out how to manage these cookies

hide cookie message
RSS FeedGovernance

StanChart agrees settlement with US bank regulator

NY bank regulator fined the British bank £216.9 million for its Iran-linked transactions

Article comments

New York banking regulator has fined Standard Chartered $340 million (£216.9 million) because of its Iran-linked transactions, ending a week of mounting tension over the authority’s role in going public.

The settlement helped push up the Asia-focused lender's shares, which had fallen last week on the news.

It is equal to less than 9 percent of its first-half pre-tax profit. At the latest levels, Standard Chartered's market value is around $3.5 billion less than it was before Lawsky's allegations.

The deal with New York Superintendent of Financial Services Benjamin Lawsky on Tuesday caps a week of transatlantic tension and a furore over why a state agency had upstaged other authorities. The British bank still faces a separate probe of its Iran-linked transactions by other US agencies.

The resolution also averted a hearing on Wednesday at which the bank had been called to show why its licence to do business in New York should not be revoked.

Standard Chartered's Hong Kong shares rose as much as 6.8 percent to HK$177, still nearly 6 percent below where they were before the allegations hit the bank early last week.

Lawsky on 6 August called Standard Chartered a "rogue institution" that had broken US sanctions on Iran, saying it hid Iran-linked transactions with a total value of $250 billion from regulators.

Lawsky's order came out of the blue, the bank said, hitting its share price and bringing top executives hurrying back to London from vacation. Bank of England governor Mervyn King said Lawsky was out of step with other US authorities. And Standard Chartered CEO Peter Sands strongly denied the allegations, saying illegal transactions totalled less than $14 million.

In his announcement on Tuesday, Lawsky said Standard Chartered "agreed that the conduct at issue involved transactions of at least $250 billion". But he gave no details on what protections the deal gave Standard Chartered.

Standard Chartered confirmed that the two sides had reached an agreement, including the payment of $340 million, and said detailed terms would be concluded soon.

In addition to the civil penalty, Lawsky said the bank agreed to an outside monitor for at least two years to check on controls on money-laundering at its New York branch.

photo credit: Reuters



StanChart agrees settlement with US bank regulator

What makes a good board report?

What makes a good board report?

Examining how CFOs can improve the way they report back to the boardmore ..

Vodafone buys out partner's stake in Indian unit

Mobile giant acquires the remaining 11% it did not already ownmore ..

Financial advisers not being clear enough on charges, says watchdog

FCA’s review found 73% of firms failed to provide adequate informationmore ..

EU data retention rules violate privacy rights, EU court rules

Rules requiring telcos to retain communications metadata are disproportionate, the court saidmore ..

Examining the issue of corporate litigation funding

Litigation funding is a very useful tool for CFOs but not a panacea for all legal mattersmore ..

Corporate governance: A catalyst for innovation

Corporate governance is a powerful tool in a C-suite executive’s arsenalmore ..

Send to a friend

Email this article to a friend or colleague:

PLEASE NOTE: Your name is used only to let the recipient know who sent the story, and in case of transmission error. Both your name and the recipient's name and address will not be used for any other purpose.

In Depth
How M&A teams can create value by challenging the CEO

How M&A teams can create value by challenging the CEO

A typical “hold” period of nine to 18 months can generate increased sale value more ..

In Depth
What every company needs to do about big data?

What every company needs to do about big data?

In the first of a three part series, Pat Brans explores just how big 'big data' will get? more ..


* *