JPMorgan bows out of IPO amid Asia hiring probe JPMorgan has bowed out of a potentially lucrative role in the $1bn Hong Kong listing of a Chinese chemicals company due to the investigation into the US bank's hiring of princelings. This is the second time in as many months that JPMorgan has walked away from an initial public offering due to the US authorities" princeling probe, after it backed out of the Hong Kong listing of Everbright Bank late last year. Tang Xiaoning, son of a former banking regulator who is now head of parent state-owned China Everbright Group, is one of the princelings - the children of high-ranking Chinese leaders - at the centre of the US probe. JPMorgan had been among the banks working with Tianhe Chemicals towards a listing but decided to end its involvement when an internal risk review noted that the daughter of the company's chairman had worked at the bank, according to people familiar with the situation. The US Securities and Exchange Commission and the Department of Justice last year launched a probe of JPMorgan's hiring practices over concerns it had hired family members of influential figures in the Chinese government and elsewhere to win business. Hiring candidates in order to land specific business mandates would violate the US Foreign Corrupt Practices Act. Joyce Wei, who is the daughter of Tianhe Chemicals chairman Wei Qi, worked at JPMorgan between January 2012 and August 2013, according to the Hong Kong regulator's register of authorised finance professionals. JPMorgan has been working with Tianhe on and off since at least 2011, according to IFR, the trade magazine, which first reported JPMorgan's IPO withdrawal. As long as the US investigation continues, JPMorgan will probably have to walk away from any other business where there is a link between its staff and the company, people familiar with the matter said, because of the reputational risk. Ms Wei, whose first name is Jiao in Chinese, now works in equity capital markets at UBS in Hong Kong. UBS also is working on the potential Tianhe IPO but was handed its role before Ms Wei joined in October last year, according to a person familiar with the situation. JPMorgan and UBS both declined to comment. Ms Wei is also not strictly a princeling as Tianhe is a private company, part-owned by Morgan Stanley's private equity arm, and not government-controlled. The hiring of well-connected youngsters is common in Asia and especially China. As much as anything else this is because their privileged backgrounds and private education make them among the best candidates in the region, banks say. In Hong Kong, for example, two daughters of Canning Fok, the chief executive of Li Ka-shing's Hutchison conglomerate, have both worked at Goldman Sachs and one is now married to Matthew Koder, the head of investment banking at Bank of America Merrill Lynch in the region. Those two banks led the recent attempted $3bn-$4bn sale of Hutchison's ParknShop business. There has been no suggestion of any impropriety in those mandates. Since launching their probe of JPMorgan, US authorities have sent letters to all other US banks and European banks with operations in both Asia and the US requesting information about their hiring practices.