24.5 C
New York
Saturday, August 13, 2022

China central bank tests new regulations on Ant Financial, Suning.com

China central bank tests new regulations on Ant Financial, Suning.comChina central bank tests new regulations on Ant Financial, Suning.com

BEIJING (Reuters) – China is testing new regulations on five financial holding companies, including e-commerce giant Alibaba’s (N:) fintech affiliate Ant Financial Service [ANTFIN.UL], paving the way for tighter oversight of the fast-growing sector.

The pilot scheme, designed to rein in debt risks among financial holding companies, also included retail conglomerate Suning.com (SZ:) and large state-owned companies such as China Merchants Group, Shanghai International Group, and Beijing Financial Holdings Group, state news agency Xinhua reported late on Friday.

Based on the trial, the People’s Bank of China (PBOC) aims to roll out a supervision plan for the broader sector as soon as in the first half of 2019, Xinhua said.

Zhou Xuedong, director of the PBOC’s Financial Stability Bureau, said some financial holding companies had grown through “barbaric” expansion and a regulatory void needed to be filled urgently.

“They are large in volume with complex businesses and high association risks, and the lack of supervision would increase risks in the financial sector,” Zhou was quoted by Xinhua as saying.

The PBOC has pledged to speed up efforts to regulate financial holding companies’ high-leverage investments and strengthen supervision over their transactions, it said in a Financial Stability report released on Friday.

The PBOC is adopting “a combination of macro-prudential management and micro-prudential supervision” in its regulatory approach, but no details were given according to Xinhua.

Shares in Suning.com (SZ:) fell as much as 1.5 pct around midday as investors worried about tighter regulations and a slowing economy that threatens to curb spending.

Suning did not immediately respond to a request for comment.

Ant Financial declined to comment.

Reuters reported in June that Ant Financial was singled out by the PBOC as the only online finance firm for a trial program to test stricter regulations on financial holding conglomerates, according to two sources.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source: Investing.com

Related Articles

Stay Connected

- Advertisement -

Latest Articles

Popular Articles