China’s central bank’s decision to suspend billionaire Jack Ma’s Ant Group’s planned initial public offering was based on a comprehensive consideration about safeguarding the interests of financial consumers and investors, a bank official said on Friday.
China stopped Ant Group’s $37 billion listings on Tuesday, foiling the world’s largest stock market debut with just days to go which came as a severe blow to the financial technology and online consumer lending firm.
This step comes at a time when greater efforts are being made by Chinese policymakers to prevent systemic financial risks and curb rising debt. It has put the company and its investors into a disturbing spot and its executives are now in a race to fulfil tighter regulations.
“The decision was made in accordance with laws and regulations… and about maintaining stable, healthy market development in the long term,” Liu Guoqiang, deputy governor of the People’s Bank of China (PBOC), told in a statement.
“The CBIRC also supports this decision made by the Shanghai Stock Exchange,” Liang said. “Any listed company must comply with the requirements of relevant laws and regulations,” Liang Tao, vice chairman of the China Banking and Insurance Regulatory Commission (CBIRC) said while supporting Liu’s proposition.
Ant Group was all set to make its market debut in Hong Kong and Shanghai on Thursday.
Liang also emphasised that CBIRC is hoping that all business entities would “remain in compliance with laws and regulations when doing business with and cooperating” with Ant Group.
“We encourage the financial sector to explore reasonable innovation while put risks under control. At the same time, we will regulate fintech in accordance with its nature of finance, and include all financial activities into the regulatory framework” Liang added.