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A man walks past the Standard Chartered bank building in Hong Kong Tuesday, Aug. 7, 2012.Kin Cheung/The Associated Press

Standard Chartered's chief executive officer Peter Sands has flown to New York to take personal control of the bank's attempts to reach a settlement with U.S. regulators over allegations it hid transactions involving Iran.

Mr. Sands is also ready to attend a hearing set for Wednesday at which the London-based bank has been told by the New York banking regulator that it must demonstrate why its state banking licence should not be revoked over the transactions.

A Standard Chartered spokesman said the bank was waiting to hear from the Department of Financial Services (DFS) what form the hearing will take. The DFS has released no details of how the session will be conducted.

"Peter is happy to go if that's appropriate," a Standard Chartered spokesman said on Tuesday.

Mr. Sands will work with the bank's lawyers, who are attempting to negotiate a settlement over the issue with U.S. authorities, the spokesman said.

Last week, New York's Financial Services Superintendent Benjamin Lawsky alleged the bank had hidden Iran-linked transactions with a total value of $250 billion and called it a "rogue institution" for breaking U.S. sanctions.

Mr. Sands cut his vacation short when details of the New York regulator's allegations emerged.

He denied the allegations and said the total amount that failed to adhere to the sanctions was less than $14 million. He also said he was taken by "complete surprise" by the ferocity of Mr. Lawsky's attack, which he described as "disproportionate."

The bank has come under pressure from shareholders to settle early rather than engage in a legal battle.

"Clearly there was concern amongst all our stakeholders. Obviously a swift settlement would be ideal, but it has to be on acceptable terms," the Standard Chartered spokesman said.

The affair has also taken on a political dimension, with some British members of parliament suggesting it is part of a U.S. effort to undermine London as a financial centre. Britain's finance minister George Osborne made a series of phone calls to his U.S. counterpart last week expressing concern at the way details of the case came out.

A U.K. government source told Reuters that Osborne had engaged in "quiet diplomacy" to ensure British business was getting a fair hearing.

The stakes for Standard Chartered are high, given that the loss of its state banking licence would effectively cut it off from direct access to the U.S. bank market. Most of Standard Chartered's business is in Asia and the Middle East.

The DFS has declined to comment on the negotiations.

A person familiar with the situation, who spoke on condition of anonymity, said Mr. Lawsky was seeking a settlement of about $350 million. Another person with knowledge of the situation said the figure had dropped to $250 million.

Standard Chartered is already co-operating in a separate probe dating to 2010 that includes the U.S. Justice Department and the Manhattan district attorney. That investigation is aimed at determining whether Standard Chartered violated U.S. sanctions laws. Those talks have been taking place separately from the discussions with Mr. Lawsky's agency.

The bank's preferred option is still a deal with all the regulators, but the decision by Mr. Lawsky to go it alone and issue an order against the bank last week has made a collective settlement less likely.

Investec analyst Ian Gordon believes the bank will end up paying a fine running into several hundred million dollars but said it could afford to do so because of its strong balance sheet. He recommends clients buy the stock.

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