Ant Group’s money market fund has shrunk to a more than four-year low as users shifted their cash in the face of China’s crackdown on Jack Ma’s payments group, reported the Financial Times.
Funds invested in Ant’s flagship Yu’e Bao fund fell 18% in the first three months of the year to RMB 972 billion ($150 billion) as the group pushed users to switch to other providers’ funds, according to data released on Thursday by its Tianhong Asset Management subsidiary. The money-market fund, once the world’s largest, acts as the main repository for leftover cash stored by hundreds of millions of users of Ant’s Alipay payments app.
Ant was ordered to “actively reduce” Yu’e Bao’s size as part of a restructuring deal struck with Chinese authorities last week. Regulators have long been concerned about Yu’e Bao’s immense size, fearing a spate of redemptions could cause systemic financial risks.
Li Huang, an analyst at Fitch Ratings, said the fall marked the largest percentage decline in Yu’e Bao’s history, adding: “We expect [its] size to further decline in the coming quarters, but maybe at a slower pace.”