Halted China IPO sends political and policy signals

Significance

The IPO was slated to be the largest in history, valued in excess of USD30bn. The incident gives investors a striking example of immediate political risk in the current Chinese environment.

Impacts

• This episode fast-tracked the publication of new draft regulations for online lending.
• Regulatory scrutiny in the entire fintech sector will intensify.
• Ant will need to adapt its business model to a higher-regulation environment, and will probably become less profitable.