Turkey's state-owned Halkbank, whose chief executive was arrested in connection with a sweeping graft investigation, said on Monday it complied with the law when doing business with sanctions-hit Iran.
"Our bank's business transactions are regularly audited by relevant authorities," the bank said in a statement.
"The financial intermediation that our bank offers with regard to trade activities with Iran have been conducted in accordance with regulations," it added.
The statement comes after Halkbank chief executive Suleyman Aslan was charged Saturday with taking bribes, while Azerbaijani businessman Reza Zarrab was charged with forming a ring that bribed officials to help disguise illegal gold sales to Iran via Halkbank.
Police had also reportedly found $4.5 million in cash stored in shoe boxes in Aslan's home.
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Twenty-four people have been charged so far in connection with the high-profile investigation including the sons of Interior Minister Muarrem Guler and Economy Minister Zafer Caglayan as well as several top business leaders.
On Saturday, Prime Minister Recep Tayyip Erdogan defended Halkbank which he claimed was targeted by international plotters.
"We have raised the bank's market value to $25 billion. They are targeting this successful state bank," he said. "This bank is intimidating Turkey's enemies."
Halkbank has come under fire from some quarters in the United States for alleged illegal transactions to Iran.
The bank said it stopped transactions to Iran as of June 10 after the United States announced further sanctions against the Islamic republic.
Several pro-government media outlets claimed over the weekend that US ambassador to Turkey Francis Ricciardone told some European Union ambassadors that Washington asked the bank to cut its ties with Iran -- the allegations vehemently denied by the ambassador.
The reports however infuriated the prime minister who warned he may expel some foreign ambassadors over "provocative actions", in remarks considered a veiled threat to Ricciardone.
Deputy Prime Minister Ali Babacan said Sunday that Halkbank has lost $1.6 billion in market value since the scandal broke out and branded the investigation as an operation aimed at undermining Turkey's economic stability.