📋 Tender Overview
Ping An Insurance is offering up a bet on Chinas bank reboot. The financial giant is preparing a roughly US1 billion Hong Kong listing for OneConnect which helps mid-sized mainland financial firms plug their technology gaps with artificial intelligence-enhanced credit checks cloud computing and apps. Beijing wants more lenders to keep cash flowing into the private sector but there is pressure to clean up bad debts too and few smaller players can manage both. Its a dilemma that should leave a lucrative niche.OneConnect backed by SoftBanks gargantuan Vision Fund is the latest of Ping Ans new-generation ventures to go public as the Chinese behemoth turns itself into a financial-technology powerhouse. Last year it listed the unit behind healthcare platform Good Doctor though it held off online lender Lufax due to regulatory scrutiny and OneConnect when markets tumbled.There is plenty to like though as the startup comes back. Part IBM part credit-rating agency with a touch of consultancy it serves mid-tier banks insurers and funds building online banking tools setting up searches for new customers through messaging app WeChat and beefing up risk management with credit checks and facial-recognition software. Customers applying for big loans for example are interviewed online with technology that reads their expressions to determine whether theyre being truthful. The proposal is alluring even without gimmicks large parts of Chinas US40 trillion banking system are struggling leaving little to invest in much-needed IT overhauls. The startup serves around 450 of over 2000 Chinese banks.There is regulatory risk of course banks and funds are under close scrutiny from Beijing and any flashpoint say a problematic default would mean costly regulatory and political backlash. There are questions around consistency too Bloomberg reports Ping An tempered valuation expectations after OneConnect didnt quite perform as expected reducing the amount on offer from US3 billion and pushing the price tag to US8 billion. Thats barely more than the US7.5 billion it was valued at last year.
