Ma Yun's Wealth Disappears by 13 Trillion Won in Two Months Amid Regulatory Pressure from Chinese Authorities

▲Jack Ma, Founder of Alibaba [Image Source=Reuters Yonhap News]

[Asia Economy Reporter Kwon Jae-hee] The fortune of Alibaba founder Jack Ma, who has been under comprehensive regulatory pressure from Chinese authorities, has reportedly evaporated by $12 billion (approximately 13 trillion won) in the past two months.

According to Bloomberg's billionaire index on the 29th (local time), Jack Ma's fortune was recorded at $42.9 billion, ranking 25th. This is a sharp decline since the regulatory pressure from Chinese authorities began in earnest at the end of last October.

However, the atmosphere was completely different in early October, just before the Ant Group, Alibaba Group's fintech affiliate, was set to go public.

At that time, Jack Ma's fortune had increased to as much as $61.7 billion due to rising stock prices, and there was analysis that he would once again become Asia's richest person.

But on October 24th, at the Shanghai Waitan Financial Summit attended by high-ranking officials including Wang Qishan, Vice President of China, and Yi Gang, Governor of the People's Bank of China, a strong criticism was made that "China's financial authorities are still stuck in 'pawnshop operations' that require collateral for loans," causing a rapid reversal of the mood.

Afterwards, warnings from the authorities began to emerge, and ultimately, the Ant Group's initial public offering (IPO), originally scheduled for the 5th of last month, was indefinitely postponed.

Ant Group operates Alipay, the most widely used electronic payment service in China, with over one billion annual users. However, Alipay itself does not generate profits; most of Ant Group's revenue comes from small loans and various investment product sales exposed through Alipay.

Seeming to target this, Pan Gongsheng, Deputy Governor of the People's Bank of China, strongly criticized Alibaba for "lacking willingness to comply with laws and disregarding regulatory authorities in pursuit of profits," urging Alibaba to return to its core payment business and strictly correct activities such as unauthorized lending and insurance product sales that violate regulations.

This was interpreted as a demand to reduce fintech business areas such as lending and investment product sales, which is expected to directly impact Ant Group's profitability in the future.

Even after the postponement of Ant Group's listing, Chinese authorities' pressure on Alibaba and Ant Group has continued relentlessly.

On the 14th, the State Administration for Market Regulation of China imposed a fine on Alibaba for antitrust violations.

In particular, on the 26th, the four major financial regulatory agencies in China, including the People's Bank of China, summoned Ant Group's management and criticized them for "weak awareness of legal compliance," reportedly demanding business restructuring such as the establishment of a financial holding company.

According to CNBC, on the 29th, the People's Bank of China also stated that Ant Group, which is preparing to establish a financial holding company, must ensure that all financial businesses are under the supervision of regulatory authorities.

The Wall Street Journal (WSJ) analyzed, "If Ant Group establishes a financial holding company, it will return to its original payment service business," adding, "In particular, this could open the possibility of acquisition of the financial holding company by Chinese state-owned banks or institutions."

This content was produced with the assistance of AI translation services.