UPDATE 1-US judge sets hearing in Halkbank case as prosecutors seek dismissal

Adds hearing schedule, background

- A U.S. judge has scheduled a hearing for Wednesday in the U.S. criminal case against Halkbank HALK.IS, court records showed on Friday, after prosecutors said they were seeking to dismiss their indictment against the Turkish lender.

  • U.S. District Judge Richard Berman scheduled the hearing for 9 a.m. EDT (1300 GMT) in Manhattan federal court.

  • Halkbank was charged in 2019 with helping Iran evade U.S. sanctions. It pleaded not guilty.

  • Prosecutors in March said they had reached an agreement with Halkbank to drop the charges in exchange for the bank barring transactions that benefit Iran and hiring a monitor to review its sanctions and anti-money-laundering compliance.

  • The settlement sent Halkbank's shares soaring on the Istanbul stock exchange.

  • Berman paused the case for 90 days to give Halkbank the chance to demonstrate compliance.

  • On Wednesday, prosecutors asked Berman to dismiss the charges because a review of Halkbank's practices by Ernst & Young did not find instances of noncompliance.