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Governor of the Bank of England Mervyn King speaks at a business conference in London July 26, 2012.POOL/Reuters

The governor of the Bank of England has questioned the approach of the U.S. regulator that accused Standard Chartered Bank of breaching sanctions by hiding $250-billion (U.S.) of transactions linked to Iran.

Speaking to reporters at a quarterly briefing, Sir Mervyn King appeared critical of New York state's Department of Financial Services, which broke ranks with other regulators probing StanChart's alleged Iranian dealings to go public with a damning report on Monday.

"I think all that the U.K. authorities would ask is that various regulatory bodies that are investigating a particular case try to work together and refrain from making too many public statements until the investigation is completed," Sir Mervyn said.

The New York DFS, created last year and led by Benjamin Lawsky, is only one of at least five U.S. agencies studying StanChart's Iranian transactions. The bank is under criminal investigation by the Department of Justice, Federal Bureau of Investigation, Federal Reserve, Treasury Department and Manhattan district attorney's office.

Some British bankers, politicians and regulators have accused Mr. Lawsky of "freelancing" – going it alone in escalating the investigation into StanChart. "He caught everyone off guard," said one regulator. "Everyone knows the bank was furious, but so were the Fed and the FSA [the City watchdog]."

The DFS alleged StanChart violated the federal sanctions law by "wire stripping" – removing codes from money transfers that would have identified Iranian clients. The U.S. imposed sanctions on Iran after the 1979 Islamic revolution.

StanChart has vigorously countered the allegations, describing any transgressions as "small clerical errors" and challenging the regulator's interpretation of the law.

"The bank throughout this period has always tried to comply with U.S. sanctions," Peter Sands, the chief executive who stewarded StanChart through the financial crisis in better health than many of its rivals, told reporters on Wednesday.

"We reject the position and portrayal of facts by the Department of Financial Services," he added.

Mr. Sands said the regulator's report had been "very damaging" to StanChart's brand. The bank has a week to prepare for a hearing at which it will seek to persuade the DFS not to revoke its rights to clear dollar transactions through the U.S., the cornerstone of its global trade finance business.

Some British politicians and bankers have styled the U.S. regulator's accusations against StanChart – which followed scandals at Barclays and HSBC – as a transatlantic attempt to dent London's reputation as a financial centre.

Asked about such suggestions, the BoE governor said: "This is straying into regulatory territory. But, overall, I don't judge my colleagues in the United States of having any such intention."

But Mark Field, the Conservative member of the British parliament for the Cities of London and Westminster, said that Wall Street – after the trading losses at JPMorgan's London office – had recognized an "irresistible opportunity unfairly to discredit the City of London".

While the investigations seemed both "credible" and "forensically thorough" they posed a "potentially calamitous threat to the City of London", he said.

On Tuesday StanChart shares in London lost almost a quarter of their value at one stage as investors feared the consequences of the Iran allegations. On Wednesday they recovered some of that ground, closing 7 per cent higher at £13.15.

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