Habib Bank Limited (HBL) has decided to legally defend itself against the New York State Department of Financial Services” scrutinization to impose $630 million for compliance failure.
On Tuesday, HBL President and Chief Executive Officer Nauman Karamat Dar while briefing media about the issue clearly stated that the bank is not involved in any specific wrongdoing. Quoting that “HBL has done nothing wrong.”
He announced the hearing of the notice would be on September 27, 2017, adding that the HBL”s legal team is preparing to appear to defend the bank. Further he announced that the bank will approach the New York Supreme Court if the regulator imposes a $630 million fine on the bank. He was expecting that HBL team will be able to clarify its position before the regulator.
However, he admitted bank branch”s failure to comply with the regulations of US regulator. He said that the HBL”s New York branch was only dealing in clearing of dollar transactions of the bank. HBL branch committed some mistakes but these were related to general safety and soundness, said Dar. He admitted the negligence on the part bank”s branch. However, he was of the view that the fine is disproportionate.
He said HBL is country”s leading bank having a large branch network, system and liquidity. It might affect profitability on a short term basis, but will never affect its business and customers. Dar said HBL has voluntarily closed its New York branch and the bank is providing services to its customers through its corresponding banks. He said HBL closed the account of Saudi bank Al Rajhi in 2014 on the directives of US regulator. He said the penalty is a commercial and regulatory matter and it has no link with the diplomatic and political issues.