The denial came a day after the New York's Department of Financial Services (DFS) threatened to revoke the bank's licence and imposed fines, as the regulator branded the London-based lender as a "rogue bank".

"The group strongly rejects the position or the portrayal of facts as set out in the order issued by the DFS," group company secretary Annemarie Durbin said in a statement.

"The group does not believe the order issued by the DFS presents a full and accurate picture of the facts."

The US regulator accused Standard Chartered of systematically disguising foreign exchange deals with Iran in a breach of controls that potentially opened up the US banking system to terrorists and criminals.

It has ordered the bank to explain the alleged violations on August 15, in the latest US move against foreign lenders accused of failing to prevent money laundering and other illicit transactions.

"The group takes its responsibilities very seriously, and seeks to comply at all times with the relevant laws and regulations," Durbin said, adding that it had "engaged with the US agencies".

The bank, which focuses on emerging markets in Asia, the Middle East and Africa, said it was surprised at the allegations as it had informed relevant US agencies in 2010 that it had voluntarily launched an internal compliance review.

It said the review "did not identify a single payment on behalf of any party that was designated at the time by the US government as a terrorist entity or organisation".

The bank also said it had stopped all new business with Iranian customers more than five years ago.

Standard Chartered's Hong Kong-listed shares plunged 7.5 percent to HK$174.0 when the market opened.

The regulator's move came after a US Senate report last month accused HSBC, also based in London, of allowing its operations to be used by Mexican drug lords, terrorist networks and sanctions dodgers.

Standard Chartered last week posted record first-half net profit of $2.81 billion, up 12 percent from the previous corresponding period.

In a statement accompanying the results, chief executive Peter Sands lauded the bank's "culture and values" as a source of strength over its competitors.

"We are selective and turn things down that we don't understand, or don't like the look of," he said.

"As a source of competitive advantage, as the ultimate protection against risk, our culture and values are our first and last line of defence."