JPMorgan becomes first global bank to fall foul of Hong Kong's stricter IPO sponsorship rules
Reuters
Published May 05, 2016 11:01AM ET
JPMorgan becomes first global bank to fall foul of Hong Kong's stricter IPO sponsorship rules
HONG KONG (Reuters) - JPMorgan Chase & Co (N:JPM) has become the first global investment bank to fall foul of Hong Kong's stricter IPO sponsorship rules, dealing a blow to its reputation in the region.
The Hong Kong stock exchange introduced tougher disclosure rules in 2014, which can make banks criminally liable if a listing prospectus is found to have misled investors.
It returned a listing application for Shenhua Health Holdings Ltd, a subsidiary of monosodium glutamate (MSG) producer Fufeng Group Ltd (HK:0546), on March 29 saying it needed more information, exchange data showed. JPMorgan Securities (Far East) Ltd acted as sole sponsor of the IPO.
Only seven other initial public offerings (IPOs) have been returned since the new rules came into effect. After applications are returned, companies must wait at least eight weeks before re-submitting an application.
The new rules aimed to crack down on sloppy work by underwriters and issuers that filed incomplete or inaccurate documents, particularly after a series of scandals at Chinese companies that ran into trouble after listing in Hong Kong.
JPMorgan declined to comment on Shenhua Health's listing application on Thursday. Fufeng Group, the world's largest producer of food flavor enhancer MSG, didn't return a Reuters request for comment after regular business hours.
The sponsors of the previous seven listings on the stock exchange's main board and Growth Enterprise Market (GEM) that needed further vetting were all from China and Hong Kong, exchange data showed.
Get The News You Want
Written By: Reuters
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.