Morgan Stanley, JPMorgan IPO deal filing nixed in Hong Kong

[HONG KONG] Morgan Stanley and JPMorgan Chase & Co's application to take a Chinese biotechnology company public was rejected by the Hong Kong stock exchange.

The announcement about Akeso Inc's listing, made late Wednesday, puts the Wall Street banks on a list that bankers have dubbed "name and shame" because it discloses the financial institutions and companies involved in any failed application.

Hong Kong Exchanges & Clearing Ltd (HKEX) said in its statement that the IPO (initial public offering) application had been returned on Dec 5. It didn't provide a reason.

In a policy put in place in October 2013, IPO applications that are incomplete will be returned by HKEX. There's no tangible punishment for banks, but the company has to wait at least eight weeks to re-submit an IPO application.

Spokesmen at Morgan Stanley, JPMorgan and HKEX all declined to comment.

The bourse has rejected 21 applications to both its main board and its GEM market since 2014. Among past rejections, most are local and mainland Chinese banks, such as Guotai Junan Capital Ltd and Bocom International (Asia) Ltd. JPMorgan also made the list for a deal in 2016.

Even if a bank is put on the list multiple times, there are few signs it undermines its ability to sponsor deals in the world's busiest IPO market. China Everbright Capital Ltd, for example, has also made the list twice.

BLOOMBERG