Hong Kong Watchdog To Impose Sanctions On Standard Chartered
British Bank Standard Chartered has been hit with a number of fines from financial regulators during the last couple of years due to a number of procedural violations.
The bank had to pay $300 million in fines after US watchdog alleged that the bank had breached anti-money laundering procedures and was also issued sanctions in 2012 for dealing with clients that had ties to blacklisted companies in Iran, Libya and Syria.
The Bank is likely to face another fine after Hong Kong watchdog has threatened to issue sanctions against the bank for breaching procedures during a stock market flotation going back to 2009. The bank confirmed that it had received a warning notice from Hong Kong Securities and Futures Commission over a 2009 IPO regulatory breach.
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Bill Winters joined Standard Chartered recently as its new chief executive officer and one of his main tasks is to steer the bank away from riskier businesses in order to avoid breaching procedures and incurring high penalties. The bank recently released its third quarter results and admitted that it is struggling to with market conditions and revenue wasn’t growing as fast as expected.
In a statement, Winters said
We have made progress executing the strategic actions announced a year ago. We now have a stronger balance sheet, reduced concentrations and are becoming more efficient, but income and profit levels are not yet acceptable. Market conditions are expected to remain challenging.
Winters wasn’t willing to disclose more information regarding the Hong Kong IPO breach as it was against the bank’s policy to comment on on-going investigations. The third quarter results showed that the bank’s pretax profit dropped from $430 million in 2015 to $153 million for the same period in 2016, which was a 64 percent decline. Overall revenue dropped to $3.47 billion which was a decline of around 6 percent.
Hong Kong regulators have stepped up their efforts to crackdown on money laundering, counterfeit currency and other financial related crimes. The watchdog has paid special attention to Chinese companies who have made false and misleading stock market listings in recent times. There is no indication so far as to what penalty Standard Chartered might have to pay for its Hong Kong IPO breach.
Standard Chartered acted as a joint sponsor in 2009 for an IPO on the Hong Kong Stock Exchange.
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