KATHMANDU: The People’s Bank of China and three other Chinese regulators on Monday said they had summoned Jack Ma, the founder of Ant, and two other executives for questions ahead of the company’s $37bn public offering, with shares due to start trading on Thursday.
In a brief statement on Monday, the PBoC, the China Banking and Insurance Regulatory Commission, the Securities Regulatory Commission and the State Administration of Foreign Exchange said they had “conducted regulatory interviews with Ant Group’s actual controller Jack Ma, chairman Eric Jing, and chief executive Simon Hu”.
The regulators provided no further details, but the Chinese word used to describe the interview — yuetan — generally indicates a dressing down by authorities.
When Ant decided to go ahead with its public offering this summer, two senior people at the company said they had received assurances from people at the PBoC that regulatory issues would not be a problem.
That was before Mr Ma gave a speech last month in Shanghai criticising regulators in China and abroad while also lambasting the country’s bankers — stirring up controversy just as Ant priced its IPO.
“China doesn’t have a systemic financial risk [problem], China’s finance basically doesn’t have risk, the risk is instead from lacking a system,” said Mr Ma.
“Today banks are still operating with a pawnshop mentality, needing collateral and guarantees are just like pawn shops . . . China’s financial pawnshop mentality is the most serious,” he added.
China’s regulatory crackdown on financial risk in recent years has forced Ant to change its business model several times. The latest challenge to its dominance is the central bank’s rollout of a digital currency which people familiar with the matter say is an attempt by the PBoC to level the playing field between banks and Ant and Tencent.
“Supervision and regulation are two different issues,” said Mr Ma. “Supervision is to watch and pay attention to development, while regulation is to manage when there is a problem. Right now we are strong at regulation but lacking in the ability to supervise.”
A spokesperson for Ant said: “Today, Ant Group’s controlling shareholder, executive chairman and CEO attended a supervisory meeting with its main regulatory bodies.
Ant Group will implement the meeting opinions in depth, and continue to follow the guidelines of ‘stable innovation, embracing supervision, service to the real economy, and openness for mutual benefit’, in order to continue to improve our inclusive service capabilities, and assist the development of the economy and people’s livelihood.”
Ant’s IPO in Shanghai and Hong Kong is expected to be the world’s biggest, after investors signed up for $37bn of shares. Last Thursday, the company’s bankers increased the offer after retail bids exceeded the value of shares on sale by more than 870 times. The expanded deal valued the company at about $316bn. Via Financial Times