Aug. 15 - British bank Standard Chartered surprised some analysts by speedily agreeing to pay a $340 million fine to New York's financial regulator, as the lender continues talks with other U.S. agencies to agree a comprehensive deal. Joanna Partridge reports.
Investors seemed to like Standard Chartered's decision to pay $340 million to New York's financial regulator. Its shares shot up 4.5% in London, recouping some of the losses made when accusations it hid banned Iranian transactions first surfaced. The British bank is now pursuing a collective settlement with other U.S. authorities under the personal supervision of StanChart's Chief Executive. Peter Sands hopes a deal will remove any uncertainty and help the bank to draw a line under the episode. But some analysts are surprised the settlement came so quickly. The bank strongly disputed the size of the transactions and had even threatened to launch a countersuit against the New York regulator. Chris Hughes is from Reuters Breaking Views. SOUNDBITE: Chris Hughes, Assistant Editor, Reuters Breaking Views, saying (English): "It's the price of moving on, we won't really ask how we got there, as a proportion of the overall business Standard Chartered can swallow it, let's just forget about it. I mean, that's one way of looking at it, but you're still left wondering, we can't compute this. You know, one day the bank's saying there's no issue, the next day it's agreeing to this big fine." Standard Chartered said it acted in the best interests of shareholders and customers. But some analysts say the punishment doesn't fit the crime. British banker David Bermingham was one of the so-called "NatWest Three" - 3 British bankers who were jailed for making illegal profits from a deal with U.S. energy giant Enron. SOUNDBITE: David Bermingham, Former "NatWest three" banker, saying (English): "My criticism is to the means and methods, ie it's the bully with the big stick saying either you write me a very large cheque or I will extinguish you and your company." The outcome could certainly have been a lot worse for StanChart - the regulator had threatened to take away the bank's New York licence. But relief could be temporary - the bank's still being investigated by other American authorities including the U.S Treasury, the Justice Department and the Federal Reserve. Joanna Partridge, Reuters