Pakistan’s Habib Bank to pay $225m New York fine

"HBL believes that the opportunity to resolve this matter consensually at this time is in the best interests of its investors, shareholders and customers. HBL remains committed to strengthening its operations and controls."

The DFS said a court hearing set for later this month had been canceled as part of the settlement.

Pakistani brokerage firm Intermarket Securities said the hefty fine would hurt profits and could force HBL to issue foreign-currency subordinated debt to pay the regulator.

But the sum was "manageable" and the medium-term outlook for the bank should not be affected, it said in a research note.

"Under the circumstances, we believe it makes sense for the bank to take this one-off hit, rather than approaching courts which would have put the share price under a cloud for longer."