Beijing (AFP)

China suspended the record market entry of online payment giant Ant Group on Tuesday, under increasing pressure from financial regulators.

This suspension brought down the title of e-commerce giant Alibaba, also created by billionaire Jack Ma, and to which Ant Group is linked.

The title lost 8% on Wall Street Tuesday and nearly 10% Wednesday when the Hong Kong Stock Exchange opened.

But Ant Group has also sparked concern among financial regulators by foraying into personal and consumer loans, wealth management and insurance.

The group announced on Tuesday that it was suspending its scheduled IPO on Thursday in the Hong Kong and Shanghai markets, after being forced by the Chinese regulator to postpone the planned IPO in Shanghai.

The operation was to allow him to raise at least 34.4 billion dollars, a historic record.

The Shanghai Stock Exchange had expressed concern in a separate statement about the risk that the company could "meet the conditions of issuance and registration or the requirements (of regulators) in terms of information."

The group itself "reported on major issues such as changes in the oversight of fintech," she said.

The announcement follows the implementation of new regulations intended to limit the risks associated with the growing online lending sector in China, a "fintech" in which Ant Group has invested aggressively.

It also took place the day after an unusual meeting with regulators to which Jack Ma, main shareholder of Ant Groupe, group chairman Eric Jing and chief executive officer Simon Hu were invited.

State media had recently warned of the financial instability that could result from the group's rapid growth.

- Takeover -

Chinese regulators "are trying to keep control of an already huge, profitable and rapidly changing fintech sector," Brock Silvers, chief investment officer at Kaiyuan Capital, told AFP.

"In the absence of established regulation, regulators may have been understandably keen to get involved," he continued.

Jack Ma, one of China's most powerful billionaires, has come under fire from state media after a speech in late October in Shanghai in which he appeared to accuse regulators of restraining fintech innovation, and said boasted of the stock market record that Ant was about to beat, after Alibaba's on Wall Street in 2015 ($ 25 billion).

The record was broken last year by Saudi oil giant Aramco ($ 29.4 billion).

On Sunday, the government-controlled Financial News worried that internet giants like Ant Group were getting too big, warning of possible "serious risk contagion."

Other comments called for tighter regulation of Ant Group's online lending.

For the Economic Daily newspaper Tuesday, the suspension of the IPO proves the determination of regulators to "safeguard the interests of investors".

Beijing encourages its technological jewels to be listed on national stock exchanges, rather than abroad, in a context of sharp economic and political rivalry with the United States.

© 2020 AFP