BEIJING - Ant Group was dealt another blow by yet more regulations to contain risks in the country's burgeoning online lending industry as Jack Ma's financial technology giant prepares for its initial public offering.
The rules add to a barrage of recent steps by regulators to rein in consumer borrowing and reduce risks. Regulators have also capped loan rates and imposed new capital and license requirements on Ant and other conglomerates. The firm is preparing to sell shares to the public and is said to seek to raise as much as US$30 billion , gunning for the largest IPO ever.
Ant, China's largest provider of online consumer loans, has relied on the business for its biggest chunk of revenue. Its two small loan companies, Huabei and Jiebei, have about 170 billion yuan of outstanding securities backed by credit assets. In total, Ant has issued about 1.7 trillion yuan in micro consumer loans, mainly through third-party banks.
Another way Ant could seek more leverage is via a new consumer finance entity it's setting up. The new company would allow leverage at 10 times registered capital.
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Source: ChannelNewsAsia - 🏆 6. / 66 Read more »