Global banking giants have grown more wary of underwriting initial public offerings by Chinese companies in the U.S., concerned about rising reputational risks after a string of disappointing deals.
The heightened scrutiny augurs a harder sell for Chinese firms once the market overcomes the current tumult. Even before the rout in equities that began last month, 26 of the 33 Chinese companies that went public in the U.S. during 2019 were trading at less than their offer prices, according to data compiled by Bloomberg.
