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Ant Group eyeing bank-like structure that could dampen profitsINTL

Ant Group eyeing bank-like structure that could dampen profits

As Jack Ma continues to scramble to find a solution to the regulatory troubles for Ant Group in China, one option that is emerging may be to reorganize its financial operations into a holding company that would be regulated like a bank. The move would require more regulatory scrutiny and capital restrictions, likely slowing growth for financial service units including wealth management services, consumer lending, insurance, and payments.

why it matters
Tech companies like Ant Group have seen fast growth, in part, because they lack the regulatory shackles that are placed on mature financial service companies. Regulation in China could hit Ant Group's profits, though regulators are unlikely to do too much damage for fear of hurting economic growth.