StanChart falls foul of New York regulators again
STANDARD Chartered is embroiled in another US investigation, after the bank yesterday revealed it had failed properly to analyse transactions for evidence of criminal activity.
The troubled bank cold pay as much as $340m (£202m) to the New York Department of Financial Services (DFS) to settle the case – below the fine it paid the same department two years ago for breaking sanctions against Iran.
When it paid that fine, Standard Chartered agreed to let monitors in to study its operations. It was those officials who discovered this latest wrongdoing, and their two-year term at the bank is expected to be extended.
“Raising the bar on conduct is imperative for us,” said chief executive Peter Sands. “It is a complex mix of legacy issues and current challenges. We are not there yet, but we are absolutely committed to getting this right.”
He also tried to put an end to rumours that some shareholders were putting pressure on him to leave the bank.
He insisted he had “no other plans” and that his current reforms at the lender were putting it back on track to make sustainable profits in future.
Pre-tax profits came in at $3.3bn for the first half of the year, down 20 per cent on the same period of 2013.
Revenues fell five per cent to $9.3bn, expenses edged up one per cent to $5.1bn, and the bank took an impairment charge of nearly $250m, in part driven by its exposure to commodities fraud in China.
But Sands said he was having more success stripping costs out of the bank.
Despite wage hikes and regulations pushing up costs by five per cent per year, he has kept cost growth to one per cent, indicating hundreds of millions of dollars of savings.
Its shares fell 0.70 per cent to 1,208p.