Newspaper article The Journal (Newcastle, England)

Scandal-Hit Standard Shows Signs of Recovery

Newspaper article The Journal (Newcastle, England)

Scandal-Hit Standard Shows Signs of Recovery

Article excerpt

Byline: Iain Laing

SHARES in scandal-hit bank Standard Chartered have continued to recover after it agreed a "lower than anticipated" settlement with regulators over allegations that it hid transactions with the Iranian government.

The 160-year-old bank agreed to pay the New York State Department of Financial Services (DFS) pounds 217m after it was accused of exposing the US to terrorists, drug kingpins and weapon dealers.

Shares rose 4.33% to close at 1429.35p as investors said the pay-out showed that Standard was taking quick action to resolve the reputation-damaging situation, although other regulators are investigating.

The bank saw pounds 6bn wiped from its value in the immediate aftermath of claims that it hid pounds 160bn of transactions, and shares are still some 9% lower than when the scandal emerged.

Richard Hunter, head of equities at Hargreaves Lansdown Stockbrokers, said: "The quick and decisive action which Standard has shown in settling this initial claim, which itself is lower than anticipated, has resulted in a further spike to the share price in early trade.

"The market will remain cautious until the extent of any further regulatory sanction is known, but in the meantime Standard appears to have taken its rap on the knuckles and is preparing to move on."

A hearing in which Standard was set to be grilled by the regulator yesterday has been adjourned.

Standard was accused by the DFS of keeping around 60,000 transactions secret from regulators in the United States over nearly 10 years.

The regulator's superintendent said a monitor would be installed at the bank for at least two years to evaluate money-laundering controls at its New York branch.

Standard, which employs 2,100 staff in the UK, previously said in a statement that it "strongly rejects" the portrayal by the DFS. It said the allegations were inaccurate and claimed 99.9% of its dealings with Iran complied with regulation. …

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