The Habib Bank Ltd. (HBL) of Pakistan on Tuesday said it would fight all 53 points included in the charge sheet over suspicious transactions after the United States financial regulator imposed a penalty of nearly USD 630 million on its New York branch.
Formerly Habib Bank Limited and now referred to as HBL Pakistan was penalised by the New York State Department of Financial Services (DFS) for deficiencies in risk management and for not adhering to the Bank Secrecy Act/Anti-Money laundering compliance programmes since 2015.
Speaking at a press conference, HBL Chief Executive Officer Nauman Dar said the penalty has no logic. However, the bank will pay the penalty if it is in a "reasonable amount". He did not elaborate what he meant by "reasonable amount", The Dawn reported.
The negotiations were failed with the U.S. regulators regarding the issue as the bank doesn't find any logic in penalising the branch 2006 onward, he added.
The bank on Monday had announced that it would close its branch in New York after the United States financial regulator imposed a penalty of nearly USD 630 million.
The bank has said that it will contest the DFS notice in court. The civil monetary penalty is to the tune of USD 629,625,000 read a letter filed by HBL to the Pakistan Stock Exchange.
"Despite HBL's sincere and extensive remediation measures, DFS is still not appreciating... the significant progress that HBL has made at its branch in New York," read the letter filed by the bank.
"HBL shall vigorously contest this [order] in the scheduled administrative hearing and the courts of law in the United States," it added.
In December 2015, the U.S. Federal Reserve had restricted HBL from conducting any dollar-clearing transactions or accepting any new accounts for US dollar.
The banking circle took the situation seriously and called it a bad omen for the country as well as the banking industry.
HBL Pakistan is headquartered in Karachi.
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