The Ant bite $35 billion for using blunt words used by Jack Ma

The company had hoped to raise up to $37 billion from the market, in an IPO that would have been the world’s largest, beating the last year’s $29.4 billion listing of Saudi Aramco. The listing was suspended after the regulators had a meeting with Ant Group founder Jack Ma and other top executives of the company. In October this year, Ma criticised China’s state machinery’s financial regulations “outdated” which were stifling innovation in the sector. The comments are said to have irked top leaders of the Communist regime, who have expressed concerns about how banks have tied up with micro-lenders such as Alipay.

China’s richest man has been busy launching the world’s biggest IPO. Jack Ma was summoned to a rare joint meeting on Monday with the country’s central bank and three other top financial regulators.Chinese billionaire founder said, We can't use yesterday's methods to regulate the future," Ma has said at a Shanghai conference

In that speech, apart from labeling the global banking Basel Accords as an “old people’s club,” Ma said “systemic risk” is not the issue in China. Rather, China’s biggest risk is that it “lacks a financial ecosystem.” Chinese banks are like “pawn shops”, where collateral and guarantees are the hard currencies. As a result, some decided to go so big they are not allowed to fail. “As the Chinese like to say, if you borrow 100,000 yuan from the bank, you are a bit scared; if you borrow a million yuan from the bank, you are a bit scared; if you borrow a million yuan, both you and the bank are a little nervous; but if you take a 1 billion yuan loan, you are not scared at all, the bank is,” Ma said.

The consequences came this week. On Monday, Beijing’s top financial watchdogs summoned Ma and dressed him down. Beijing also issued draft rules on online micro lending, stipulating stricter capital requirements and operational rules for some of Ant Group Co.’s consumer credit businesses. But the big shocker came on Tuesday night. The Shanghai Stock Exchange suspended Ant’s listing on its Star board, citing Monday's meeting and subsequent regulatory changes. Ant then said in a filing it would suspend its Hong Kong IPO as well.

In the fast-growing consumer credit business, Ant is essentially a matchmaker while banks lend and put aside cash in case some loans go sour. Fintech giants are making much more than lenders, city commercial banks complained to local media.

At the opening of his speech, Ma admitted he was conflicted as to whether to attend the forum and speak up. Now he probably regrets it. But here’s the thing: If China is serious about financial innovation, “inclusive financing” or the digital yuan, let the man who pioneered the business and made billions along the way share his experiences and thoughts.