Wall Street investment banks JPMorgan and Morgan Stanley have been placed on the Hong Kong Stock Exchange's "named and shamed" list after the $300 million initial public offering (IPO) of Chinese biotech company Akeso Inc. was sent back for not meeting the correct regulatory requirements.

A notice published on the Hong Kong exchange's website on Wednesday showed the IPO submission, which was sponsored by JPMorgan and Morgan Stanley, had been rejected and progress on its plans to list would now be delayed.

The New York legal firm, Davis Polk & Wardwell, had been hired to carry out the legal work on the deal.

Bankers and lawyers working in Hong Kong refer to the returned list as a "named and shamed" file because of the rarity of IPO submissions being sent back by the exchange.

The exchange's website shows just 11 IPOs have been sent back in the past six years, out of thousands lodged in that time, on Hong Kong's main while on the GEM board, a secondary index, only 10 have been returned during the same period.

In Hong Kong, sponsoring banks must conduct due diligence to assess the company being listed, and are responsible for assuring potential investors that its IPO prospectus is accurate.

Coincidentally, before Akeso was returned, JPMorgan was the only Western bank to have had an IPO returned after Shenhua Health was sent back by regulators in 2016.

JPMorgan and Morgan Stanley declined to comment on the Akeso matter.

A Davis Polk spokeswoman did not immediately respond to Reuters.

Akeso, a clinical stage biotech company based in Guangdong that specialises in oncology and immunology, had filed its IPO documents last year to start trading on the Hong Kong market.

The Hong Kong Stock Exchange did not publish reasons for the IPO having been returned and a spokesman declined to comment on Wednesday.

A source with direct knowledge of the matter said Akeso had submitted financial accounts with the exchange to meet its requirements for a listing in March.

However, the date was then changed to an April listing which meant the 2019 second half results should have been included in the submission but were left out.

Akeso is expected to lodge a new listing application shortly, however, under the Hong Kong Stock Exchange's rules the company must wait two months from when the issue was first raised which was Dec. 5.