HSBC's suspended sentence in the US for money laundering has ended, helping Britain’s biggest bank clear the decks ahead of incoming chief executive John Flint taking the helm in February.

The lender has had the threat of further sanctions looming over it since it paid a then-record fine of $1.9bn (£1.4bn) to the Department of Justice (DoJ) in 2012.

The penalty was for helping Mexican drug cartels launder money and for breaching international sanctions by doing business with Iran.

HSBC agreed a five-year deferred prosecution agreement at the time with the DoJ, under which the bank agreed to strengthen its anti-money laundering controls.

Additional sanctions could have included further fines and even locking HSBC out of key US markets, which would have severely damaged the lender.

HSBC’s shares jumped 1.7pc today on the news to almost 746p.

Ian Gordon, analyst at Investec, said the development meant HSBC’s legacy problems were now “largely” behind it, although it still faces a $1bn-plus fine in the coming months for its role in mis-selling toxic mortgage products in the US ahead of the financial crisis.