The United States is to repay Iran a $400 million debt and $1.3 billion in interest dating to the Islamic revolution, Secretary of State John Kerry said Sunday. The repayment, which settles a suit brought under an international legal tribunal, is separate from the tens of billions of dollars in frozen foreign accounts that Iran can now access after the end of nuclear sanctions. But the timing of the announcement, one day after the implementation of the Iran nuclear accord, will be seen as pointing to a broader clearing of the decks between the old foes.

US President Barack Obama defended the settlement in a televised statement from the White House, saying it was for “much less than the amount Iran sought.” “For the United States, the settlement could save us billions of dollars that could have been pursued by Iran. There was no benefit to the United States in dragging this out,” he said. Kerry said the claim was in the amount of a $400 million trust fund used by Iran to purchase military equipment from the United States prior to the break in diplomatic ties, plus $1.3 billion in interests. FULL REPORT