China’s authorities ordered Ant to reexamine its fintech business, ranging from wealth management, consumer credit lending, and insurance – Bloomberg. The regulators asked Ant to return to its payment roots and even came close to directly asking for a breakup of the company.
- The regulators’ warning comes even as millions of investor dollars hang in the balance after what would have been the world’s biggest initial public offering was suspended.
- China’s authorities also warned Ant of sub-par corporate governance, disdain towards regulatory requirements, and engagement in regulatory arbitrage.
- China’s central bank alleges Ant used its dominance to exclude rivals, hurting hundreds of millions of consumers’ interests.
- The regulators want Ant to set up a separate financial holding company to comply with rules and ensure sufficient capital.
- Ant said it will set up a special team to comply with regulatory’ demands, maintain business operations for users, and will not increase prices for consumers and financial partners.
- Analysts believe regulators focus on overseeing the country’s financial sector, sending a warning to the internet companies without intentions of drastic change.
Alibaba’s stock is currently gaining in Hong Kong. 9988: HKG is up 6.10%.