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Jack Ma Tells Chinese Regulators Ant Group Not A Bank

As China’s Ant Group readies for its IPO — the biggest ever — founder Jack Ma wanted to clarify that the company is a tech firm, not a bank, Reuters reports.

The classification is important for investors. Reuters writes that while Ant presents itself as a tech company, financial regulators have suggested it’s under their umbrella. Ant benefits from the far more bountiful valuations tech firms can get rather than the ones usually allotted for financial institutions, and the company also hopes to get out from under the thumb of financial regulators, Reuters reports.

The aforementioned IPO will go for $34.4 billion, which outpaces the previous record for biggest in history from Saudi Aramco for $29.4 billion in December of last year. It’s a double IPO planned to be listed both in Shanghai and Hong Kong.

The IPO is being led by tech teams at most of Ant’s underwriter banks, rather than by finance teams, Reuters writes, meaning that the classification as a tech company has merit.

Ant, formed in 2004 as Alibaba’s payments processor, also works to connect China’s borrowers and lenders and can secure short-term loans in minutes. It has broadened its reach to include artificial intelligence and other such techniques to work with insurance, wealth management and other types of products. CEO Simon Hu recently said tech was “part and parcel of everything we do” for 16 years since forming, Reuters writes.

But skeptics point out that it was only this year that Ant changed its name from Ant Financial, meaning it’s unlikely regulators will give it a pass.

Ma was summoned for an interview over the IPO by the Peoples’ Bank of China and numerous regulators, PYMNTS reports. In a brief statement, the groups said they had “conducted regulatory interviews with Ant Group’s actual controller Jack Ma, Chairman Eric Jing and Chief Executive Simon Hu.”

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