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StanChart says faces probe over work on Hong Kong IPO

HONG KONG (AFP) – 

Standard Chartered could face “financial consequences” after an investigation in Hong Kong over its role in an initial public offering, the firm said as it reported another round of disappointing earnings results, sending its share price tumbling

The London-based, Asia-focused lender said authorities were looking into its conduct while co-sponsoring the listing in the city in 2009, dealing another legal blow to the firm, which is already facing a US probe.

“The Group has been informed by the Hong Kong Securities and Futures Commission that it intends to take action against Standard Chartered Securities (Hong Kong) … in relation to its role as a joint sponsor of an initial public offering listed on the Hong Kong Stock Exchange in 2009,” it said in its interim earnings report.

“If it does take action there may be financial consequences” for the bank, it said in the report Tuesday.

The announcement came as it said pre-tax profit improved in the third quarter to September but was still well short of expectations, while revenue was also below forecast.

Shares in the firm plunged 6.52 percent by the break in Hong Kong Wednesday. Its London-listed shares ended down 5.42 percent.

Last week Swiss giant UBS said it could faced a fine and suspension from sponsoring IPOs in Hong Kong over a listing in the city.

Neither bank said which IPO the actions referred to, but the Financial Times cited an unnamed source as saying the investigations centred on the listing of China Forestry Holdings.

Standard Chartered is still being probed by US authorities over claims of bribery by an Indonesian power company, MAXpower Group, which is controlled by the bank.

The probe is the latest in a string of legal problems for the bank, which paid $667 million in 2012 to settle charges it violated US sanctions by handling thousands of money transactions involving Iran, Myanmar, Libya and Sudan.

In August 2014, the bank was hit by US regulators with a $300 million fine and restrictions on its dollar-clearing business for failing to detect possible money-laundering.

© 2016 AFP

Article source: http://www.france24.com/en/20161102-stanchart-says-faces-probe-over-work-hong-kong-ipo