Investors carved HK$67 billion off Standard Chartered Bank yesterday, or nearly a sixth of its stock market value, despite the bank's quick denial of US regulator claims it engaged in illegal dealings with Iranian financial institutions.
The UK-based lender's shares, which usually trade at a premium to its peers such as HSBC, plummeted 14.89 per cent, or HK$28, to close at HK$160.10 each.
The stock fared even worse in London, plunging 16.76 per cent to close at 1,223.57 pence. Between Monday morning trade in New York and lunchtime in London yesterday, the stock lost a quarter of its value, or about HK$112 billion.
The New York State Department of Financial Services said on Monday that Standard Chartered conducted at least US$250 billion worth of transactions with Iranian financial institutions from 2001 to 2010.
It alleged the bank falsified business records and filings and evaded US sanctions on Iran.
It estimated the number of secret transactions to be 60,000 and said the bank 'left the US financial system vulnerable to terrorists, weapons dealers, drug kingpins and corrupt regimes'.