Halkbank shares slump as New York trial progresses

Shares of Turkey's Halkbank slumped after several of its former officials were named in court documents in an Iran sanctions-busting trial in New York, raising concern it will be fined by U.S. authorities.

Halkbank dropped 5.6 percent to 8.86 lira at 5:25 p.m. on the Istanbul Stock Exchange, extending a decline to 45 percent since the end of August. The main banking index fell 1.9 percent to 149.957,95 points.

Mehmet Hakan Atilla, deputy chief executive of Halkbank, is accused by U.S. prosecutors of laundering hundreds of millions of dollars through the U.S. banking system and defrauding the U.S. government. Iranian-Turkish businessman Reza Zarrab, a co-conspirator, was named in the court documents yesterday as a possible witness. Murat Çetinkaya, the former CEO of Halk Investment and current head of the Istanbul Stock Exchange, was also named by the court as a person of interest in the case.

Zarrab will testify as a witness in the case as early as Tuesday, Bloomberg reported citing a lawyer for Atilla.

Foreign banks including French bank BNP Paribas have already been fined as much as $8.9 billion by U.S. regulators for money laundering and sanctions-busting since the 2008 financial crisis. Turkey has labelled the case against Halkbank as political and evidence as fabricated.