Alibaba wins approval to establish private bank in China

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The finance arm of e-commerce giant Alibaba Group Holding Ltd. has been awarded a licence to allow it to set up a private bank in China, in the group’s latest push into the financial services sector.

The affiliate Zhejiang Ant Small & Micro Financial Services Group Co., which includes the company’s Alipay payment processing and financial services arm, is set to own 30 per cent of the bank in Hangzhou of Zhejiang province, according to a statement on the China Banking Regulatory Commission’s website.

The other named shareholders of the new bank are: Fosun Group subsidiary holding 25 per cent,  a subsidiary of Wanxiang Group 18 per cent and Ningbo Jinrun Asset Management  16 per cent. The statement also showed that Zhejiang Ant Small and the other co-founders now have six months to finalise preparations for the lender. Other stakeholders will be audited by the Zhejiang banking regulator.

In a separate arrangement, JuneYao Group Co. and Shanghai Metersbonwe Fashion & Accessories Co.  have won a licence to set up another new  bank in Shanghai. JuneYao will own a 30 per cent stake and Shanghai Metersbonwe will hold 15 per cent.

Both of these new approvals come as part of a batch of new private banks in China, following the launch of a pilot programme earlier this year that is aiming to open the country’s closely guarded banking sector to private investors.

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