Credit Suisse settles with US over Iran
By Haig Simonian in Zurich
Published: December 15 2009 20:27 | Last updated: December 16 2009 00:04
Credit Suisse surprised financial markets on Tuesday night after revealing it expected to pay US authorities about $536m to settle issues relating to financial dealings with Iran.
The Swiss bank, which has gained a reputation for avoiding accidents during the credit crisis, declined to provide details beyond the contents of a brief press release.
In its statement, Credit Suisse said the negotiations related to “US dollar payments during the period 2002 to April 2007 involving parties that are subject to US economic sanctions”. A person familiar with the situation said the case involved more than $1bn of funds.
The deal, for which some provisions have already been taken, is expected to require an additional charge of SFr445m before tax in the fourth quarter, equivalent to a net impact of SFr360m in the period.
The bank declined to indicate when it thought its negotiations, involving five US authorities including the Manhattan District Attorney’s Office, the US justice department and the Federal Reserve, would be concluded. However, officials indicated the surprise statement had been prompted by a leak.
The US investigations into Credit Suisse had been disclosed previously but had been largely overlooked in the thick of the credit crisis. The US authorities are believed to be investigating nine banks in relation to Iran. Lloyds Banking Groupof the UK has already reached a $350m settlement.
Credit Suisse stressed that it had decided to terminate business with Iran in December 2005.
However, it was not until the following year that the group shut its representative office in Tehran and ended all business with parties sanctioned by the Office of Foreign Assets Control, the US body involved in policing business with countries, entities or people subject to US economic sanctions.
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