Hangzhou, Liu indicated, “will always be the home port for Ant Group to fly high and venture afar”. He said the city’s leadership will establish a “normalised mechanism” to help promote Ant’s development.
Liu, who had visited Ant Group’s headquarters in January, said he expected the company and Hangzhou to collaborate in various digital transformation initiatives. These include getting the company’s popular electronic payments platform Alipay and online lender MYBank to play a bigger role in internet-based inclusive finance, especially for the city’s small and medium-sized enterprises.
In addition, Ant Group is expected to help Hangzhou in staging major international events, including the 2023 Asian Games from September 23 to October 8 and a “global digital trade expo”, Liu said. He became party chief in Hangzhou in late 2021, replacing Zhou Jiangyong who pleaded guilty in April to pocketing more than 193 million yuan (US$28 million) in a landmark Chinese anti-corruption case.
Ant Group’s pact with Hangzhou reflects the company’s new-found confidence in playing a role to boost the country’s economy, following Beijing’s move to ease the curbs on China’s Big Tech companies.
The thaw in regulatory scrutiny comes years after China’s regulators foiled Ant Group’s US$37 billion stock sale in 2020, when they called a halt on the November 5 debut of the company’s shares on the Shanghai and Hong Kong exchanges, less than 48 hours before the highly anticipated start of trading. That debacle also followed a controversial speech that Ma delivered about financial regulation in China.
A major part of Ant Group’s rectification process is that the company must abide by the same regulatory rules as traditional banks in providing credit services, a requirement that could reduce its profitability.
The fintech giant’s net profit in the September quarter last year declined 83 per cent from the same period in 2021, according to Alibaba financial reports, which disclosed the e-commerce group’s share of dividends from Ant Group.
Meanwhile, Ant Group’s push to the finish line of its restructuring efforts comes as China continues its sweeping reshuffle within the country’s financial regulatory system. Former Industrial and Commercial Bank of China vice-president Li Yunze was appointed last week to head the new National Financial Regulatory Administration (NFRA).
The yet-to-be launched NFRA will incorporate the China Banking and Insurance Regulatory Commission and absorb the central bank’s supervisory body for financial holding companies and the securities regulator’s investor protection function, according to a draft plan submitted to the National People’s Congress – China’s top legislature – earlier this year.
