Commerzbank seen next in line to settle for violating sanctions by Geoffrey Smith @FortuneMagazine July 8, 2014, 5:45 AM EDT E-mail Tweet Facebook Google Plus Linkedin Share icons Germany’s second-largest bank, Commerzbank AG, is likely to be the next European bank to settle accusations that it violated U.S. sanctions, according to the New York Times.The paper said the bank will pay “at least $500 million”, most likely under a deferred prosecution agreement allowing it to avoid facing criminal charges.It’s only a week since the Justice Department and New York’s Department of Financial Services extracted a record $8.9 billion penalty from France’s largest bank, BNP Paribas BNPQY , for using the U.S. financial system to bankroll the governments of Iran, Sudan and Cuba, in violation of U.S. sanctions.With that precedent set, officials expect other European banks to follow suit and settle in the coming weeks. In Commerzbank’s case, the investigations relate to Myanmar and North Korea, in addition to Iran, Sudan and Cuba, according to its annual report.The NYT’s estimate of “at least $500 million” puts the likely settlement within the bank’s comfort zone–it has already set aside €982 million ($1.33 billion) in provisions against legal risks. By contrast, BNP’s fine was over six times what it had set aside.That might reduce the risk of the case becoming another political hot potato. Unlike the BNP case, the German state is a minority shareholder in Commerzbank with a stake of 17%, having bailed out the bank during the financial crisis. U.S.-German relations are already under strain following new allegations of spying by the C.I.A. on German lawmakers.Nobody at Commerzbank was immediately available to comment on the report.Commerzbank’s shares were down 3.7% in early trading Tuesday in Frankfurt in reaction to the news.