JPMorgan withdraws from $2 billion China Everbright Bank HK listing: source

HONG KONG Tue Nov 19, 2013 4:51am EST

A sign outside the headquarters of JP Morgan Chase & Co in New York, September 19, 2013. REUTERS/Mike Segar

A sign outside the headquarters of JP Morgan Chase & Co in New York, September 19, 2013.

Credit: Reuters/Mike Segar

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HONG KONG (Reuters) - JPMorgan Chase & Co has withdrawn from a syndicate of banks working on a $2 billion Hong Kong listing by China Everbright Bank Co, a person familiar with the matter told Reuters.

JPMorgan's exit comes as it faces a number of investigations by U.S. regulators, including a look into its hiring practices in China. U.S. authorities are probing whether the bank improperly gave jobs to well connected people in Asia to win business.

JPMorgan at one point hired Tang Xiaoning, the son of Tang Shuangning, chairman of Everbright Bank's parent, China Everbright Group, and a former bank regulator, The New York Times reported in August. After the younger Tang joined JPMorgan, the bank won several important assignments from Everbright, including advising a subsidiary on a stock offering, the newspaper reported.

JPMorgan has said it is cooperating fully with U.S. regulators, but declined to comment further on Tuesday.

The New York Times reported earlier this month that JPMorgan paid $1.8 million over two years to a small consulting firm run by the daughter of former Chinese Premier Wen Jiabao, a relationship that formed part of the wider U.S. probe.

The U.S. bank also faces a settlement for its liability to government agencies over mortgage securities. JPMorgan and U.S. government officials have agreed on terms of a $4 billion consumer relief package that is to be part of a $13 billion deal, a person familiar with the matter told Reuters on Monday.

Shanghai-listed Everbright Bank said in March it planned to issue up to 12 billion shares in a Hong Kong listing, after shelving similar plans in 2011 and again in 2012.

JPMorgan was at that time hired among a group of nine bookrunners to underwrite the deal, IFR magazine reported in March. Everbright told state media in August that its decision to hire JPMorgan to underwrite its Hong Kong listing was not linked to the U.S. bank hiring Tang.

The Wall Street Journal first reported JPMorgan's withdrawal from the Everbright deal earlier on Tuesday.

(Reporting by Elzio Barreto and Lawrence White; Editing by Matt Driskill and Ian Geoghegan)

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Comments (2)
DeSwiss wrote:
Well, they finally got ”The Whale.” Now onto the pond scum….. :-/

Nov 19, 2013 6:55am EST  --  Report as abuse
UauS wrote:
“U.S. authorities are probing whether the bank improperly gave jobs to well connected people in Asia to win business.” – do they really need to investigate?.. That’s the ONLY way to do business in China… Actually, direct bribing is another one, sorry…

Nov 19, 2013 12:12pm EST  --  Report as abuse
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