BUENOS AIRES (Reuters) - US Secretary of State John Kerry on Thursday defended the Obama administration's payment of US$400 million (S$539.1 million) in cash to Iran, denying it was a ransom for the release of American prisoners by Teheran or tied to the Iran nuclear deal.

"The United States does not pay ransoms," Mr Kerry told a news conference in the Argentine capital Buenos Aires.

He said the transfer, which came out of a long-standing Iranian claim at the Iran-United States Claims Tribunal in The Hague, was negotiated on a separate track from the nuclear deal.

By settling the claim, it saved US taxpayers potentially billions of dollars in further interest payments, Mr Kerry added.

As the US presidential campaign heats up, Republicans, including Donald Trump, have attacked the Obama administration over the payment, questioning the timing of the transfer.

The White House announced on Jan 17, a day after the prisoner exchange, it was releasing US$400 million in funds frozen since 1981, plus US$1.3 billion in interest owed to Iran.

The remaining interest has since been fully paid from the US Treasury-administered Judgment Fund, according to a US official.

The funds were part of a trust fund Iran used before its 1979 Islamic Revolution to buy US military equipment that was tied up for decades in litigation at the tribunal.

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