Both Ant Financial and Lufax are said to be preparing for potential public offerings next year in Hong Kong.
Ant Financial, which is about one-third owned by Alibaba, operates a variety of services. Those include Alipay, which is comparable to PayPal (NYSE: PYPL); Yu'e Bao, a consumer-facing money-market fund; online bank MyBank; and Zhao Cai Bao, a lender for small and medium-sized businesses. The company was reportedly valued at $60 billion with a $4.5 billion financing in April.
Lufax, meanwhile, operates a peer-to-peer lending marketplace that connects borrowers with potential lenders. A $1.2 billion round of funding in January is reported to have given the company an $18.5 billion valuation.
Both companies were reportedly weighing IPOs on a Shanghai-based exchange, but those plans were deterred by strict regulatory requirements in China. With last year's stock market crash still fresh in regulators' minds, those severe policies don't seem likely to slacken anytime soon. The apparent irony is that, by trying to protect Chinese markets, those regulators may be driving the next wave of giant tech companies to list outside of the country's primary stock exchanges in Shanghai and Shenzhen.