China’s Central Bank hints that Ant Group’s IPO could resume

China’s central bank governor signals that the door remains open for Jack Ma backed Ant Group stock market debut. Ant’s initial public offering (IPO) could resume if it resolves its issues.

Ant group was set to sell shares worth US$ 34.4B in November 2020. But the Chinese Government suspended the IPO at the eleventh hour. If the IPO had come through, the listings in Shanghai and Hong Kong would have been the biggest stock market debut to date. The Ant Group runs Alipay, a giant Fintech and online payment system in China. It has a consumer lending division, which takes fees from banks to match borrowers with lending services. Jack Ma’s Alibaba owns a third of Ant. Alibaba is listed in the US and Hong Kong and broke the record for the biggest stock market debut in 2014.

Last year, after Ant’s listing was suspended, the People’s Bank of China ordered a major shakedown at Alibaba. People even got concerned about Jack Ma’s whereabouts as he didn’t give any public appearance for the last three months. However, in January Jack Ma made his first appearance speaking to a group of teachers via video-conferencing as part of a charity event.

The Central Bank governor Gang Yi said that Ant Group’s share market listing will be reconsidered under the right circumstances. “I’d say that you just follow the standard of legal instruction, you will have the result,” said Gang Yi at a virtual meeting of the World Economic Forum on Tuesday. He also described the suspension of the listing of Ant Group as a “complicated issue”.

Being China’s biggest payments provider, with more than 730 million monthly users on its digital payments service Alipay, Ant Group is bound to be under the Government’s radar. After Jack Ma criticized the Chinese government officials and compared China’s state-dominated banking sector to “pawn shops” that lack innovation, the Govt. decided to crackdown on his business empire. Many people saw it as a vengeful communist party lashing out at the outspoken businessman.

China’s govt. has been struggling to assess new technologies and their possible impacts on the stability of China’s financial system. Many financial technology companies have opened up the country’s financial system, providing numerous options to smaller borrowers. However, the Govt. feels that this has created possible risks.

“That benefit is obvious, but at the same time we can see also some risks to consumer information and protection and also some monopoly potential and also some misuse of the monopoly power,” said Gang Yi.

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