ANT GROUP CO., LTD. is making a significant capital increase, with state-owned capital control strengthening; after restructuring, Huabei has just announced brand isolation and will become the exclusive consumer lending brand of ANT GROUP CO., LTD.

CHINA CINDA contributed 6 billion yuan.

According to announcements from CHINA CINDA and other companies on December 24, Chongqing Ant Consumer Finance Co., Ltd. (hereinafter referred to as Ant Consumer Finance) has increased its registered capital by 22 billion yuan to all subscribers; after the capital increase is completed, the registered capital will increase from 80 yuan to 30 billion yuan.

Multiple companies participated in this funding round, including ANT GROUP CO., LTD. contributing 11 billion yuan; CHINA CINDA contributing 6 billion yuan; Jiangsu Yuyue Medical Equipment & Supply contributing 1.098 billion yuan; Sunny Optical, Boguan Technology, and Yufu Capital contributing 1.8 billion yuan, 1.322 billion yuan, and 780 million yuan respectively.

After the capital increase is completed, ANT GROUP CO., LTD. remains the largest shareholder of Ant Consumer Finance with a shareholding ratio of 50%; CHINA CINDA and its subsidiary Nanyang Commercial Bank hold a total of 24%, becoming the second largest shareholder; the remaining shareholders include Sunny Optical, Jiangsu Yuyue Medical Equipment & Supply, Boguan Technology, China Trust, Yufu Capital, Contemporary Amperex Technology, China TransInfo Technology, and CHINA HUARONG.

CHINA CINDA represents state capital, with holdings of 58%, 14.04%, and 5% respectively held by the Ministry of Finance, the National Social Security Fund Council, and China COSCO Shipping Corporation Limited. CHINA CINDA's business focuses on the operation of non-performing assets, mainly providing financial solutions and asset management services to clients; Nanyang Commercial Bank is a subsidiary of CHINA CINDA, mainly operating in Hong Kong and mainland China.

Regarding this capital increase, CHINA CINDA stated that against the backdrop of growing consumer demand and an increasingly完善监管体系, the scale of the consumer finance industry continues to expand, and the application of financial technology drives financial innovation. The Director believes that ANT GROUP CO., LTD. has investment value due to the empowerment of financial technology, relying on commercial scenarios and customer traffic.

Some existing Shareholders have also given up this capital increase. China TransInfo Technology (002373) announced that the company has decided not to participate in ANT GROUP CO., LTD.'s current capital increase based on its development plan and operational status, agreeing to the capital increase plan and waiving its preemptive subscription rights. After the capital increase is completed, the company's shareholding ratio will decrease from 7.01% to 1.869%.

The shareholder background of ANT GROUP CO., LTD. after the capital increase is very diverse, and the strength of state-owned capital has significantly increased. In addition to CHINA CINDA, other representatives of state-owned capital include Chongqing State-owned Assets Supervision and Administration Commission’s Yufu Capital, primarily engaged in asset acquisition and disposal. On the private capital side, Cathay United Bank mainly engages in Forex business, CHINA HUARONG is mainly involved in distressed asset management; additionally, there are several technology companies, including Contemporary Amperex Technology, China TransInfo Technology, Jiangsu Yuyue Medical Equipment & Supply, Sunny Optical, and Boke Technology, engaged in the businesses of power Battery, Big Data services, medical instruments, optical components, and gaming software respectively.

Huabei is the exclusive consumer credit brand of ANT GROUP CO., LTD.

According to the announcement, ANT GROUP CO., LTD. has achieved revenue of 0.291 billion yuan since its establishment in June 2021 until the end of the third quarter of this year, with a pre-tax loss of 0.618 billion yuan, total assets of 60.098 billion yuan, and net assets of 7.475 billion yuan.

ANT GROUP CO., LTD. was first established in September 2020, but due to the suspension of listing at the end of 2020 and the financial business facing regulatory rectification, it was only approved to commence operations in June this year. The newly established ANT GROUP CO., LTD. is chaired by Huang Hao, president of ANT GROUP's digital financial business group, and Chen Huaisheng serves as the general manager.

According to the notice issued by the Office of the China Banking and Insurance Regulatory Commission in February of this year, titled "Notice on Further Standardizing the Internet Loan Business of Commercial Banks," ANT GROUP CO., LTD., as a licensed financial institution, is subject to strict constraints on operational rules regarding equity ratios, concentration, and limits in joint loans.

In response to regulatory requirements, Huabei has recently announced brand separation. On November 24, Huabei announced that it will become the exclusive consumer credit brand of ANT GROUP CO., LTD. and will focus on small and medium-sized consumer needs; consumer credit fully funded by banks and other financial institutions will be updated to the "Crediting Purchase" type of service.

According to the announcement, after brand separation, Huabei and the "Crediting Purchase" service will maintain consistency in core experiences such as interest-free periods, account checking, and repayments; the fee rates for the "Crediting Purchase" service will remain stable; in the future, the fee rates for the "Crediting Purchase" service will be independently approved and determined by financial institutions, and will also follow the principle of inclusive finance to benefit users as much as possible.