News
FINANCIAL SERVICES | Staff Reporter, Hong Kong
view(s)

Hong Kong slaps $100m fine on global banks over IPO sponsor failures

UBS faces the highest fine of $47.77m.

Hong Kong authorities have slapped a combined $100.22m (HK$786.7m) fine on global banks including UBS, Standard Chartered, Merrill Lynch and Morgan Stanley over their work in relation to a number of IPOs.

Also read: SFC laments underperforming bank IPO sponsors

UBS AG and UBS Securities Hong Kong Limited faced a sum of $47.77m (HK$375m) for failing to discharge their obligations as one of the joint sponsors in the listing applications of China Forestry, Tianhe Chemicals Group Limited (Tianhe), and an undisclosed listing application.

Additionally, the Securities and Financial Commission (SFC) suspended UBS Securities Hong Kong’s license to advise on corporate finance for one year. Managing director Cen Tian also had his Hong Kong license suspended for a two-year period.

Standard Chartered Securities (Hong Kong) Limited (Standard Chartered Securities) is required to shell out $7.61m (HK$59.7m) over its joint sponsor work in relation to China Forestry’s share sale. Morgan Stanley and Merrill Lynch were respectively hit by a $28.54m (HK$224m) and $16.31m (HK$128m) fine over their joint sponsor work in Tianhe’s IPO in 2014.

The shares of China Forestry and Tianhe were suspended soon after going public after financial irregularities rose.

“The sanctions send a strong and clear message to the market that we will not hesitate to hold errant sponsors accountable for their misconduct,” Ashley Alder, SFC chief executive officer, said in the statement. 

Do you know more about this story? Contact us anonymously through this link.

Click here to learn about advertising, content sponsorship, events & rountables, custom media solutions, whitepaper writing, sales leads or eDM opportunities with us.

To get a media kit and information on advertising or sponsoring click here.