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UBS Wins Early Reprieve From Hong Kong Ban on IPOs

Kiuyan Wong

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UBS Group AG won an early release from a ban on sponsoring initial public offerings in Hong Kong, setting it up to once again broker deals in the world’s busiest market.

The lifting of the ban comes after UBS “engaged and cooperated” with an independent 10-month review over its policies, procedures and practices, the Securities and Futures Commission said in a statement late Tuesday.

UBS was in March last year fined HK$375 million ($48 million) and had its license suspended for a year. The early release is a rare move for the regulator and will allow the Swiss bank to get back into the game as the Asian financial hub seeks to lure more international IPOs via primary and secondary listings. Hong Kong was the top spot globally for IPOs last year, boosted by Alibaba Group Holding Ltd.’s $13 billion secondary listing late last year.

Three other banks were also penalized in March, including Standard Chartered Plc, Morgan Stanley and Merrill Lynch, who all escaped a ban. The combined fine for the four banks reached $100 million.

Hong Kong’s regulator assessed the fine over the mismanagement of three IPOs in the city that handed investors big losses and dented the credibility of the financial center. The IPOs in question were by China Forestry Holdings Co., Tianhe Chemicals Group Ltd. and China Metal Recycling Holdings Ltd., people familiar said last year.

A UBS spokeswoman declined to comment.

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To contact the reporter on this story: Kiuyan Wong in Hong Kong at kwong739@bloomberg.net

To contact the editors responsible for this story: Candice Zachariahs at czachariahs2@bloomberg.net, Jonas Bergman

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