Ant Group’s original listing date is tomorrow (November 5). It is a rare situation in history that it is suddenly “suspended” on the eve of listing. Not to mention that Ant has attracted up to 20 trillion in new funds from A-share and H-share investors.
Funds of this scale and the possible return of frozen funds in the future are self-evident for the impact on the entire market. The suspension of Ant Group’s listing is destined to become an important event in financial history. In addition, the revaluation of Ant Group and even similar companies in exchange for the suspension of the listing plan may profoundly change the status quo in the field of non-bank payment institutions.
On the evening of November 3, Tencent News “Frontline” learned through relevant sources that Jing Xiandong, executive chairman of Ant Group, convened an emergency meeting with senior executives. was delayed for about half a year. According to media statistics, a total of 6.66 million households in A+H cities participated in Ant Group’s new venture.
On the morning of November 4, Ant Group announced on the Hong Kong Stock Exchange that it would suspend the listing of H shares and return the application funds for the Hong Kong public offering. The application monies for the Hong Kong public offering will be refunded in two batches without interest. Earlier, according to Hong Kong media reports, when Ant Group conducted a public subscription, its number of subscribers and frozen funds both broke records. Its final frozen funds exceeded 1.3 trillion yuan, setting a new record for IPOs in Hong Kong.
The wind and rain are about to come and the building is full of wind. Before the IPO, the blockbuster news of tightening the spell has been one after another.
On the evening of November 3, the news of Ant Group’s suspension of listing has caused strong concern. The Shanghai Stock Exchange said in an announcement that the regulatory environment for fintech has also changed. Relevant matters may make the issuer not meet the relevant issuance and listing conditions or information disclosure requirements of the SSE STAR Market. Suspend the listing of Ant Technology Group Co., Ltd. The “financial technology regulatory environment has also changed” as mentioned here actually refers to the just-released “Interim Measures for the Administration of Online Micro-loan Business (Draft for Comment)” and the recent related spiritual documents.
The regulatory layer has a strong meaning to strengthen supervision, and ants bear the brunt of the pain of change. In essence, this also reflects the contradiction between traditional financial supervision and the development of modern technology finance. Different from the new ideas that Jack Ma felt, in the eyes of professional financial professionals, they are more aware of potential financial risks.
It is foreseeable that the Internet used to be the least regulated in China. Due to its full-fledged and even “prosperous wealth”, based on social management or other deep-seated interest demands, power is likely to tighten the curse.
The Shanghai Stock Exchange issued a decision to suspend Ant’s listing. A kick in the door, but did not send the ball into the door.
On the evening of November 3, the Shanghai Stock Exchange announced that on November 2, 2020, the People’s Bank of China, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission, and the State Administration of Foreign Exchange issued a statement to the issuer’s actual controller, Jack Ma, chairman Jing Xiandong, and general manager. Hu Xiaoming conducted a supervisory interview. The fintech regulatory environment has also changed. Relevant matters may make the issuer not meet the relevant issuance and listing conditions or information disclosure requirements of the SSE STAR Market. Suspend the listing of Ant Technology Group Co., Ltd.
On the evening of November 3, Ant Group Hong Kong Stock Exchange announced that it would suspend the listing of H shares. At present, the website of Ant Group’s listing process on the Shanghai Stock Exchange has been deleted, and many pages on the website of the Science and Technology Innovation Board show that it does not exist.
Documents on the official website of the Shanghai Stock Exchange.
The Hong Kong Stock Exchange said it was notified by Ant Group today that it had decided to suspend its listing in Shanghai and Hong Kong.
On the eve of the IPO, on the evening of November 2, Jack Ma was jointly interviewed by the four departments. According to the website of the China Securities Regulatory Commission, the People’s Bank of China, the China Banking and Insurance Regulatory Commission, the China Securities Regulatory Commission and the State Administration of Foreign Exchange conducted regulatory interviews with the actual controller of Ant Group, Jack Ma, Chairman Jing Xiandong, and President Hu Xiaoming.
At that time, Ant Group replied that the actual controller of the group and the relevant management had accepted regulatory interviews from major regulatory authorities. Ant Group will thoroughly implement the interview opinions, and continue to follow the 16-character guideline of “steady innovation, embracing supervision, serving entities, and openness and win-win”, and will continue to enhance its inclusive service capabilities to help economic and people’s livelihood development.
However, before that, the heavy news of tightening the spell has been one after another.
First, the Central Deep Reform Commission reviewed and approved the “Implementation Plan for Improving the Delisting Mechanism of Listed Companies” and “Several Opinions on Strictly Cracking Down on Illegal Activities of Securities in accordance with the Law”.
Next, the China Banking and Insurance Regulatory Commission and the People’s Bank of China solicit public opinions on the “Interim Measures for the Administration of Online Micro-loan Business (Draft for Comment)”. The “Measures” consists of 7 chapters, including general provisions, business access, business scope and basic rules, operation and management, supervision and management, legal responsibilities, and supplementary provisions, with a total of 43 articles.
The official document of the Shanghai Stock Exchange said that “the regulatory environment for financial technology has also changed”, which actually refers to the draft. The opinion draft has a strong meaning to strengthen supervision, and ants bear the brunt of the pain of change.
For example, in principle, the balance of online loan companies’ single-family loans to natural persons does not exceed 300,000. According to some viewpoints and analyses, Ant’s service targets are often long-tailed groups that are not covered by traditional financial institutions. Such customers usually lack more professional financial knowledge and investment decision-making ability, and have a serious herd mentality. When the market experiences large fluctuations or market conditions reverse, group irrational behaviors are likely to occur, and long-tail risks may spread rapidly, forming a systemic financial system. risk.
For example, “Huabei” and “Jibei” are aimed at young people who are not deeply involved in the world, and have weak self-control. If they rely on credit guarantees alone, they will inevitably plant the seeds of a financial crisis.
And just a week ago, Jack Ma delivered a widely circulated speech at the Bund Financial Summit in Shanghai.
“We must get rid of the pawn shop thinking of finance. At present, we must replace the pawn shop thinking with a credit system based on big data with the ability to use technology. This credit system is not based on IT and acquaintance society. Building on the basis of big data can truly make credit equal to wealth.”
While its golden sentence has received a lot of likes online, it has also attracted criticism from professionals in the financial field.
The official account of the Financial Times of the People’s Bank of China reprinted an article by a scholar on Saturday, saying that some BigTech companies did not need to accept prudential supervision at the beginning of their establishment, but later took public deposits in disguise, “such as Ant Group 688688.SS, which has obtained a lot of financial business licenses, If you can carry out deposit and loan business similar to that of a bank, prudential supervision is required.”
The article points out that fintech has four special risks: inducing excessive debt consumption, forming a “winner takes all”, enhancing the contagion of financial risks, and excessively collecting customer data.
A scholar in the financial field of Tongji University criticized and analyzed that Ma Yun’s subsidiary (Ant Financial Services) wants to do high-leverage revolving lending, and there are only two ways to achieve this goal: one is bank lending, but there is a mortgage rate limit; the other One approach is asset securitization, but this is limited by capital, which is also required in the Basel Accord.
The scholar pointed out that it is because of the above-mentioned regulatory restrictions that Jack Ma criticized the bank for changing the idea of pawnshops and criticized the “Basel Accord” as a club for the elderly. According to the data of Ant Group, which recently released its prospectus, only 20% of the real loans are to small and micro enterprises, and the other 80% are consumer loans.
This may also reflect the contradiction between traditional financial supervision and the development of modern technology finance. Different from the new ideas that Jack Ma felt, in the eyes of professional financial professionals, they are more aware of potential financial risks. With the advent of the era of big data and the continuous financial innovation, how to balance the risk prevention and support for innovation is an urgent research topic.
Especially in China, which emphasizes relying on internal circulation, expands the domestic demand market, and drives the economy through consumption, while the Internet provides fast consumption and credit, how to establish matching financial supervision means is a top priority.
Last night, Alibaba Group also responded immediately, and we will work with Ant Group to actively cooperate and embrace supervision.
In an official announcement to investors, Ant Group wrote:
Ant Group received a notice from the Shanghai Stock Exchange today to suspend its A-share listing plan on the Shanghai Stock Exchange. Affected by this, Ant’s plan to simultaneously list its H shares on the Hong Kong Stock Exchange will also be suspended.
Ant Group apologises for the trouble this has caused investors. We will properly handle the follow-up work in accordance with the relevant rules of the two exchanges.
Steady innovation, embracing supervision, serving entities, and openness and win-win will make Ant Group stand the test and trust. We will adhere to our original intention and mission, and continue to use our enthusiasm, professionalism and responsibility to serve the majority of small and micro enterprises and mass consumers. We will maintain close communication with the Shanghai Stock Exchange and the regulatory authorities regarding the next progress of the issuance and listing, and disclose relevant information in a timely manner.
At 22:24 on November 3rd, Beijing time, the official account of Ant Financial issued a letter of apology.
As of press time, the market value of Alibaba Group fell by more than 8.1%.
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