Regulator approves Ant Group subsidiaries’ ABS financing program following suspended IPO

Source: Global Times Published: 2020/11/25 12:08:39

Photo taken on Oct. 26, 2020 shows Ant Group logo on the buildings of Hangzhou headquarters in Hangzhou, east China's Zhejiang Province. (VCG)

Two Asset-Backed Securities (ABS) financing programs belonging to Ant Group's online lending subsidiaries, with a combined issuing scale of 20 billion yuan ($3.03 billion), have been approved, according to a release by the SSE Corporate Bond Information of the Shanghai Stock Exchange on Wednesday.

The two online lenders are Chongqing-based small loan companies operating on Ant Group's main consumer-focused financing products, Huabei and Jiebei . Observers viewed the approval, following the suspension of Ant's mega dual- listing scheduled for earlier this month, cold send a positive sign to the market and help regain investors' dampened confidence on the firms' prospect. 

The two financing programs, each 10 billion yuan in scale, were accepted on November 6 and November 3, respectively. They were approved by the Shanghai stock exchange on November 23 and November 20. 

According to the release, the Shanghai Stock Exchange also accepted another three ABS financing programs linked to the two lenders, in total equaling 26 billion yuan. 

"Regulatory approval of Ant Group's refinancing programs is an encouraging sign. It puts to rest market speculation that Chinese regulators would take a 'one-size-fits-all' approach to Ant's financial innovation products, which could potentially sink the business," Dong Dengxin, Director of the Finance and Securities Institute at Wuhan University of Science and Technology, told the Global Times on Wednesday. 

Dong added that Chinese regulators were acting in an objective, fair and rational way. "It provides hope that Ant Group's business may continue to expand in the future."

Chinese stock bourses announced the suspension of a planned dual listing on November 3 in Shanghai and Hong Kong by Ant Group in order to protect the interests of consumers and investors.

On Monday, Zhang Yong, Alibaba Chairman and CEO told the World Internet Conference held in Wuzhen, East China's Zhejiang Province, that Alibaba is a beneficiary of China's digital economy era.

"We are very grateful for this era," Zhang said, while noting that China's digital economy is due to the government's encouragement on development and innovation. He also pledged that Alibaba will actively learn and respond to government policies and rules to build a healthier platform economy.

The Shanghai Stock Exchange said in an announcement on Tuesday that it will prioritize both supervising and providing services, and spend more efforts helping honest and professional firms transform, grow stronger and better quality through the use of capital market.

Global Times


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