Top Securities Regulator Backs Suspension of Ant IPO

What’s new: China’s top securities regulatory body, the China Securities Regulatory Commission (CSRC), said it supported the Shanghai stock exchange’s decision to halt the mega share sale of fintech giant Ant Group Co. Ltd.

The decision to suspend a “hasty” initial public offering (IPO) of Ant Group amid a changing regulatory environment will protect investors and ensure accurate, transparent information disclosure, the CSRC said in a statement (link in Chinese).

Changes in fintech industry regulations will have a “huge impact” on Ant Group’s operational structure and profit model, the commission said. The CSRC will work closely with regulators in Hong Kong to properly handle follow-up issues, the agency said.

The background: Ant Group’s record $34.5 billion concurrent IPO in Shanghai and Hong Kong was suspended after the Shanghai bourse said Tuesday it decided to shelve the share sale due to regulatory changes.

China Monday released new draft rules that would lay out tougher restrictions for online microlenders, affecting Ant’s major profit-generating businesses Huabei and Jiebei, some industry insiders said.

The abrupt suspension sent shockwaves through the market, forcing brokers and banks to scramble to unwind at least $3 trillion of orders placed for the shares.

Quick Takes are condensed versions of China-related stories for fast news you can use. To read the full story in Chinese, click here.

Related: Update: Ant’s $34.5 Billion IPO Suspended in Shanghai and Hong Kong

Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (bobsimison@caixin.com)

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