Standard Chartered PLC said on Monday it was in talks with New York’s banking regulator to try to settle allegations it hid transactions with Iran.
The two sides have been negotiating ahead of a hearing set for today, at which the bank must demonstrate why its state banking license should not be revoked over the transactions.
Last week, the state’s Financial Services superintendent, Benjamin Lawsky, said the bank hid Iran-linked transactions with a total value of US$250 billion.
Standard Chartered chief executive Peter Sands has denied Lawsky’s allegations and said the total amount that failed to adhere to US sanctions on Iran was less than US$14 million.
A bank spokeswoman said negotiations were continuing, but she declined to give details.
“We’re still trying to reach a settlement,” the spokeswoman said.
New York’s Department of Financial Services declined to comment.
A person familiar with the situation, who spoke on condition of anonymity because of not being authorized to speak about the matter, said that Lawsky was seeking a settlement of about US$350 million. Another person with knowledge of the situation said the figure had dropped to US$250 million.
In the past, New York bank regulators acted in concert with federal authorities and state prosecutors. Lloyds Banking Group paid US$350 million to state and federal authorities in 2009 to settle charges it altered records for clients from Iran and other countries. Credit Suisse AG settled similar charges for US$536 million the same year, Barclays PLC agreed to pay US$298 million in 2010 and in June ING Bank agreed to pay US$619 million.
Standard Chartered’s shares, which fell sharply last week after Lawsky’s announcement, rose 0.5 percent to ￡13.335 on hopes of a resolution.
“It looks like, rather than fight this in the courts, they’re looking to resolve this, hopefully ahead of Wednesday,” analyst Vivek Raja at Investec said.
The Department of Financial Services has released no details of how today’s hearing will be conducted and David Neustadt, a spokesman for Lawsky, declined to comment on whether the hearing would be open to the public.
The bank is awaiting information on whether executives will be required to attend, and Sands remained in Britain, a person close to the situation said who did not want to be named because of not being authorized to speak about the matter.