:00:08. > :00:16.nation. Those of the headlines. Now it is time for the latest financial
:00:16. > :00:24.news. Hello and welcome to World Business
:00:24. > :00:28.Report. A rogue institution - US regulators accused Standard
:00:28. > :00:33.Chartered of a $250 billion laundering scheme with Iraq. It is
:00:33. > :00:40.the latest scandal to engulf a British bank. I am Rico Hizon.
:00:40. > :00:43.Standard Chartered's shares slumping to a near two year-low.
:00:43. > :00:51.Serious allegations from a US regulator.
:00:51. > :01:00.LA us GDP figures confirm the recession has deepened for Italy,
:01:00. > :01:05.pursuing more pressure on Prime Minister Mario Monti.
:01:05. > :01:13.British banking group Standard Chartered illegally schemed to
:01:13. > :01:18.avoid sanctions with Iran for more than a decade, helping longer $250
:01:18. > :01:22.billion through the US financial system, the accusation from a US
:01:22. > :01:27.regulator, who are threatening to strip the Bank of its licence in
:01:27. > :01:33.New York. It is the latest scandal to rock the British banking
:01:33. > :01:37.industry. In a sane, Standard Chartered has strongly rejected the
:01:37. > :01:47.facts alleged by the regulator and says it is conducting a review of
:01:47. > :01:48.
:01:48. > :01:54.its US compliance. It also says it sees all of new business with
:01:54. > :01:58.Iranian customers in any currency over five years ago. We will see
:01:58. > :02:04.what this is doing to the share price in Asian trading in a moment
:02:04. > :02:08.but first a report from New York. Standard Chartered does most of its
:02:08. > :02:12.business in the emerging economies of Africa and Asia. Until now it
:02:12. > :02:19.had stayed largely clear of the crisis and scandals that have
:02:19. > :02:24.humbled so many other banks in recent times. Not any longer. US
:02:24. > :02:29.authorities say Standard Chartered has helped Iran before it long-
:02:29. > :02:34.standing American sanctions on a massive scale. In the last few
:02:34. > :02:39.years these sections have been aimed at stopping Iran's suspected
:02:39. > :02:46.nuclear weapons programme. In a statement, the New York banking
:02:46. > :02:54.regulator said that in its evidence it has seen hundreds of millions of
:02:54. > :02:57.dollars of fees and the bank has falsified records. It did this,
:02:58. > :03:02.allegedly, to make so crucial information was omitted from
:03:02. > :03:12.details of individual transactions involving a run. What comes across
:03:12. > :03:13.
:03:13. > :03:18.is the size of these transactions. If it is proven it or so there was
:03:18. > :03:23.an attempt to strip the information that banks often rely on to make
:03:23. > :03:28.sure the transactions are complying with the US law. Regulators alleged
:03:28. > :03:34.that Standard Chartered showed contempt for US banking regulations
:03:34. > :03:44.and sight an internal e-mail sent from the head office in London,
:03:44. > :03:45.
:03:45. > :03:49.In a statement, Standard Chartered strongly rejected the way you as
:03:49. > :03:55.authorities portrayed the facts and said it had ceased all new business
:03:55. > :03:59.with Iranian customers more than five years ago. In the past,
:03:59. > :04:09.American regulators have accused a number of other European banks,
:04:09. > :04:10.
:04:10. > :04:16.including HSBC and Credit-Suisse. Recently, the Dutch bank IMG,
:04:16. > :04:20.agreed to pay a party of more than $600 million. The punishment for
:04:20. > :04:28.Standard Chartered should be allegations be borne out could be
:04:28. > :04:33.very heavy indeed. Let's see what is happening to the
:04:33. > :04:38.shares of Standard Chartered in Asian trade. Rico Hizon is in our
:04:38. > :04:46.Singaporean Office. Unsurprisingly, shares in the bank are sharply down
:04:47. > :04:51.in Hong Kong trading? That is right. Standard Chartered's shares are
:04:51. > :04:59.slumping to a near two-year low on the Stock Exchange and made these
:04:59. > :05:04.allegations. The stock is between 6.5% and 7% at this hour. Analysts
:05:04. > :05:14.have said that despite the statement rejecting allegations by
:05:14. > :05:15.
:05:15. > :05:20.the New York regulator that this was a rogue institution, investors
:05:20. > :05:25.are not buying that story and they are saying many questions are still
:05:25. > :05:31.left unanswered. They said the investigation is just the tip of
:05:31. > :05:41.the iceberg and the risk in the US unit may be stripped of its licence,
:05:41. > :05:49.which could lead to a greater sell- off in the bank. Two birds of its
:05:49. > :05:55.profits come from a show. HSBC is trading higher -- from Asia. As you
:05:55. > :06:01.said, many questions are still unanswered. Thank you.
:06:01. > :06:04.Moving on to other news. Italy is publishing preliminary GDP figures
:06:04. > :06:10.later and they are expecting to show the country is moving further
:06:10. > :06:18.into recession. Predictions are for the economy to have contracted more
:06:18. > :06:22.than 0.5% on the previous quarter and 2.3% on the year. This puts
:06:22. > :06:28.further pressure on Mario Monti who is trying to get the country's
:06:28. > :06:33.finances under control. He believes the country can continue to finance
:06:33. > :06:38.its three trillion dollar debt without an external bailout. We
:06:38. > :06:44.spoke to an economics adviser. He joins me through Skype. Thank you
:06:44. > :06:50.for being with us. Well Italy have to go for a full bailout. We heard
:06:50. > :06:55.that Spain is considering it. As Italy moved its position as all?
:06:55. > :07:05.Italy is now looking at the Spanish situation. The Government will
:07:05. > :07:06.
:07:06. > :07:13.probably wait until September to see if Spain presses ahead with the
:07:13. > :07:22.bailout. Italy wants to afford that route, as a matter of pride. -- to
:07:22. > :07:28.avoid. So we will see what happens. We will probably have the answer in
:07:28. > :07:33.September. It is indicated that Italy will try not to follow that
:07:33. > :07:43.route. Many people of his they are wondering will Mario Monti be there
:07:43. > :07:50.this time next year? For sure there are some doubts, especially now,
:07:50. > :08:00.and there is a lot of discussion about the new laws but full of life
:08:00. > :08:00.
:08:00. > :08:06.from the next elections next year. -- that will apply. There are many
:08:06. > :08:11.questions as to whether they will apply once Mario Monti is out of
:08:11. > :08:18.office. He is trying to bring financial stability and a balanced
:08:18. > :08:24.budget next year. I think it will month
:08:24. > :08:34.month to month. This year will be a year of stability but next year
:08:34. > :08:35.
:08:35. > :08:40.hopefully will be a year of growth. Thank you.
:08:40. > :08:46.While Europeans fret about economic slowdown, the largest hotel company
:08:46. > :08:52.in the world has no such worries. Intercontinental is expected to
:08:52. > :09:00.report underlying profits are up by 15% today. The company is the best
:09:00. > :09:05.performing share on the FTSE 100 and it appears to have a good way
:09:05. > :09:10.of making money. This is a view to die for, looking
:09:10. > :09:13.straight out on the Olympic Park. The financial performance of the
:09:13. > :09:18.company looks equally impressive, not just because of a record demand
:09:18. > :09:24.for hotel rooms but because of its textbook approach to business. How
:09:24. > :09:29.much money did it costs the company to open this has? Precisely nothing.
:09:29. > :09:35.Because, like Coca-Cola and McDonald's, this is a franchise
:09:35. > :09:40.operation. They put no money in and take no risk, simply charging a
:09:40. > :09:45.percentage of the hotel's income. That model enables them to expand
:09:45. > :09:48.quickly in countries where people are travelling more. Airlines are
:09:48. > :09:55.forecasting growth and when you look at the bid the economies of
:09:55. > :10:00.Brazil, Russia, India and China and China is very important to
:10:00. > :10:09.intercontinental, there are many markets for them to move into.
:10:09. > :10:16.hotel chain began 60 years ago this became car owners they wanted
:10:16. > :10:22.something more modern to stay in than roadside hotels. It has made
:10:22. > :10:27.innovation in hotel industry. It was the first to introduce
:10:27. > :10:34.telephones and televisions in rooms and the first to allow children to
:10:34. > :10:39.stay free. All of these innovations responded to a simple idea of
:10:39. > :10:44.providing family focused hotel expenses. And they are promising to
:10:44. > :10:48.serve up much more of the same in the years to come. Apparently it
:10:48. > :10:54.has more than 1,000 hotels in the pipeline and that is likely to
:10:54. > :11:01.leave it the best performing hotel chain in the world.
:11:01. > :11:10.Now a quick flash of the markets. In Asia, Japanese stocks gained
:11:10. > :11:14.from the second day. There is optimism Germany will support the