Alibaba Group Holding BABA-backed Ant Group has secured approval to boost its registered capital to $5.4 billion, up 47%, Bloomberg News reported on Sunday, citing National Enterprise Credit Information Publicity System.
What Happened: The boost in the capital base comes nearly a year after Chinese regulators halted Ant Group's record $37 billion initial public offering and ordered the Jack Ma-founded company’s fintech unit to overhaul its operations.
The boost comes from the fintech giant’s capital reserve rather than any fundraising activities or from investors, as per the report.
Any, which runs micro-loan services Huabei and Jiebei, reportedly plans to use the capital for its new subsidiaries including its consumer finance unit.
See Also: Alibaba-Backed Ant To Share Consumer Credit Data With Chinese Central Bank
Why It Matters: Ant Group has been, for months, undergoing a restructuring to turn itself into a financial holding firm that falls under the purview of the Chinese central bank.
Chinese regulators have acted on the belief that companies like Ant were acting as financial institutions but haven't been regulated like them.
Chinese tech platforms have for years resisted sharing data, a key asset that helps them run operations, manage risk and draw new customers.
Price Action: BABA shares closed 3.5% higher at $161.5 a share on Friday.
Read Next: Alibaba Skyrockets 8% In Hong Kong As Meituan Regulatory Fine Fuels Market-Wide Optimism
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