Banks will not end connected hiring
Financial institutions say employing the children of government officials or important people happens all over the world
Banks have no plans to change their policy of hiring so-called princelings or other well-connected people to help grow their business on the mainland or in other emerging markets - despite the shockwaves caused by news that United States regulators are investigating JP Morgan's hirings of the children of the elite in China.
The US Department of Justice last month joined the Securities and Exchange Commission in examining whether conflicts of interests may arise for the US investment bank from its hires of the princelings - the second or third generations of senior mainland government leaders - to help the firm secure deals in China.
The JP Morgan case attracted public attention on the mainland where social unrest is on the rise due partly to the corruption perceived as widespread within the ruling party.
However, many bankers said the case would not stop banks from hiring the children as the practice was not unique to China and occurred around the world, in particular on Wall Street.
Sergio Ermotti, the global chief executive of UBS, who is ambitious about the Swiss bank's rapid expansion in China, said he would not rule out the hiring of sons and daughters of Chinese leaders as long as they were hired on merit.
"Our hiring policy focuses on recruiting the best talent, regardless of their background. It is also discrimination if we decide not to hire a good talent just because he or she comes from the family of a leader," he said.
"The most important issue is to have good controls in place to prevent any conflict of interest and UBS has always had policies in place to prevent that happening."
