August 7, 2012 / 7:20 AM / 5 years ago

Standard Chartered down 16 percent in early trade

Workers at Standard Chartered First Bank walk in the lobby of the bank's headquarters in Seoul in this June 27, 2011 file photo.Jo Yong-Hak/Files (SOUTH KOREA - Tags: BUSINESS)

LONDON (Reuters) - Shares in Standard Chartered (STAN.L) fell sharply in early trade on Tuesday after New York's top bank regulator threatened to strip the British bank of its state banking license, saying it hid $250 billion in transactions tied to Iran.

Standard Chartered shares were down 16 percent to 1,237 pence at 03.15 a.m. EDT, compared with a 0.8 percent fall in Europe's bank index .SX7P.

"Given that the shares are not especially cheap, particularly in relative terms, it may be the shares remain in the doldrums for a while now that their blameless reputation has suffered a knock," one top 15 investor in the British bank told Reuters on condition of anonymity.

Standard Chartered said it "strongly rejects" the claims.

Reporting by Matt Scuffham and Sinead Cruise

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