Standard Chartered's share price was boosted by almost 7% during morning trading after the firm strongly rejected claims it is a "rogue institution" that breached money laundering laws with Iran.
The rise follows a share price plummet of 16.43% late on Tuesday, which saw £8.2bn wiped off the bank's value.
It was the steepest fall in one day for more than two decades and brought shares down to a three-year low of £10.92.
It comes as it emerged the US treasury and federal reserve are angry with New York's banking regulator for going public with an explosive attack on Standard Chartered.
The New York state department of financial services (DFS) accused the British bank of violating US law by laundering $250bn (£160bn) in transactions tied to Iran.
Head of the DFS, Benjamin Lawsky said Standard Chartered's dealings exposed the US banking system to terrorists, drug traffickers and corrupt states.
Meanwhile politicians in the UK claim the assault on the bank is part of an "anti-British bias" as US authorities plot to undermine London's banking sector.
Labour MP John Mann said: "I think it's a concerted effort that's been organised at the top of the US government.
"This is Washington trying to win a commercial battle to have trading from London shifted to New York."
Referring to recent scandals with libor rate fixing at Barclays bank and claims of money laundering for Mexican drug traffickers at HSBC, Mr Mann said there is "disproportionate publicity that's given to British banking problems as opposed to American banking problems".
