The shares of Turkish public bank Halkbank climbed more than 8% on Monday after a United States appeals court put its prosecution by the federal government for allegedly helping Iran evade American sanctions on hold while the lender appeals to the U.S. Supreme Court.
Halkbank shares were 8.5% higher at TL 5.59 at 7:27 a.m. GMT.
"The bank plans to file a petition with the U.S. Supreme Court," Halkbank said in a statement to the Borsa Istanbul Stock Exchange (BIST) on Monday.
"The proceedings in the district court will be stayed until the process at the Supreme Court is completed," it said.
Halkbank has been at the center of a major dispute between Ankara and Washington. U.S. prosecutors accused the bank of helping Iran evade U.S. sanctions in a case that has strained U.S.-Turkey relations. The Turkish bank denied any wrongdoing.
Friday’s order from the 2nd U.S. Circuit Court of Appeals in Manhattan allows Halkbank to appeal without having to defend against the criminal case at the same time.
The U.S. Department of Justice had opposed a delay, saying Halkbank’s "meritless" claims neither raised "substantial" questions nor overcame the public interest in a speedy trial.
Halkbank has pleaded not guilty to bank fraud, money laundering and conspiracy over its alleged use of money servicers and front companies in Iran, Turkey and the United Arab Emirates (UAE) to evade sanctions.
Its alleged misconduct includes helping Iran secretly transfer $20 billion of restricted funds, including $1 billion laundered through the U.S. financial system, and converting oil revenue into gold and then cash to benefit Iranian interests.
Halkbank had appealed a ruling by U.S. District Judge Richard Berman, allowing it to be prosecuted.
Berman has overseen several related cases, including the conviction of former Halkbank executive Mehmet Hakan Atilla and a guilty plea by Iranian Turkish gold trader Reza Zarrab.
Atilla was convicted in January 2018 and returned to Turkey in July 2019 after leaving prison.
In an Oct. 22 decision, the 2nd Circuit said Halkbank could be prosecuted because its alleged misconduct involved commercial activity that was not covered by sovereign immunity.
Halkbank said that decision conflicted with Supreme Court precedents as it "greenlights the first criminal trial of a foreign sovereign in the nation’s history."
It also said it would suffer irreparable harm if forced to defend against "a case from which it is immune."
The Supreme Court denies most appeals. In its last term, it received 5,307 filings and heard arguments in 72 cases.