Ant Group Co., the financial technology giant controlled by billionaire Jack Ma, will apply to become a financial holding company under the supervision of China’s central bank, reviewing its operations to adapt to a new era of stricter regulations for internet companies.
In a statement, the People’s Bank of China said Ant representatives had been summoned to a meeting Monday with four regulatory agencies, including the country’s bank, securities and foreign exchange supervisors. It said a “comprehensive, viable recovery plan” for Ant has been drawn up under the supervision of regulators in recent months.
The directive follows an intense regulatory attack on Mr. Ma’s business empire that began with the suspension of the company’s IPO in November. Ant was on track to sell and list more than $ 34 billion worth of stock on the stock exchanges in Hong Kong and Shanghai when Beijing pulled the plug after Mr Ma criticized financial regulators in a public speech.
In January, The Wall Street Journal reported that Ant planned to be fully compliant with China’s financial regulations by turning itself into a financial holding company, a relatively new designation for companies with significant financial assets.
Ant, owner of the ubiquitous mobile payment and lifestyle app Alipay, will have to correct what regulators call unfair competition in its payment business and improve its corporate governance. The Hangzhou-based company will have to reduce the liquidity risks of its investment products and reduce the assets under management of Yu’e Bao, its giant mutual money market fund. Ant will also be required to break an “information monopoly” on the vast and detailed consumer data it has collected, the central bank said.