A U.S. federal judge on Wednesday ordered the dismissal of a long-running case against Halkbank over alleged Iran sanction violations after the Turkish public lender completed a compliance review.
The bank's shares on the Borsa Istanbul Stok Exchange (BIST) rose as much as 8.4% after U.S. District Judge Richard Berman signed a "nolle prosequi" order requested by U.S. Attorney Jay Clayton seeking to drop the case.
"The criminal case against our bank ongoing in the United States for years has been definitively and conclusively closed," Halkbank said in a statement.
Halkbank CEO Recep Süleyman Özdil said the lender expected its opportunities to access foreign funding would improve.
The dismissal promised to relieve one of the main irritants between Türkiye and the U.S., as the NATO allies experience their best ties in decades.
Halkbank was charged in 2019 during President Donald Trump's first term with allegedly helping Iran evade American economic sanctions. The bank had pleaded not guilty in the case.
President Recep Tayyip Erdoğan repeatedly rejected the charges, insisting that Ankara did not violate the U.S. embargo on Iran. Erdoğan once called the case unlawful and "ugly."
After Erdoğan and Trump met last year, the Turkish president expressed hope for a resolution of the matter.
Erdoğan said in October that Trump told him during the September meeting at the White House and in a subsequent phone call that the "Halkbank problem is finished for us."
This March, the U.S. Department of Justice announced a deferred prosecution agreement in which it would dismiss the case following a successful compliance review of Halkbank's programs.
No money changes hands under the deal, and the bank did not admit criminal wrongdoing.
To fulfill the agreement's requirements, Halkbank enlisted a Turkish affiliate of accounting firm Ernst & Young to review the bank's compliance program and check whether any transactions were for the benefit of Iran or Iranian persons or entities.
In a June 10 joint request to judge Berman co-signed by Halkbank counsel, attorney Clayton said the bank's compliance obligation "has been satisfied," according to a 12-page letter.
The review identified "no findings of noncompliance," the letter said.
