Lufax banks on potential IPO to help fund expansion

HONG KONG: Lufax, China’s biggest peer-to-peer lending and wealth management platform, sees a potential listing helping to fund expansion at home and abroad, though it has set no specific timeline for a deal, said chief executive officer Gregory Gibb.

Valued at US$18.5 billion (RM77.89 billion) when it raised US$1.2 billion from a group of investors in January, Lufax picked four banks to prepare a Hong Kong initial public offering (IPO) that could raise US$5 billion, sources said previously. Giant Chinese insurer Ping An Insurance is its biggest investor.

“We really don’t comment on specific plans around the IPO,” said Gibb, speaking on the sidelines of a financial technology conference, here. “Whether it’s for supporting domestic growth or supporting, eventually, international moves... if you have that flexibility, it’s a good thing to have,” Gibb said, referring to a stock market listing.

Lufax was looking to expand here or Singapore in a bid to offer more wealth management products and other international investments to wealthy Chinese investors in its platform, said Gibb.

“The main core (of the business) will remain domestic for the foreseeable future,” he added. “We’ll be working in a financial centre, like Hong Kong or Singapore, to start providing global products to those investors, keeping our idea of an open platform.”

New regulations unveiled by China in August to tame its peer-to-peer market would slow down growth for the market as a whole, forcing many smaller players to shut down, said Gibb. But larger companies like Lufax should benefit as investors look for relative safety in more established companies.

While the market as a whole is expected to grow between 30 and 40 per cent this year, Lufax expects to expand “north of 50 per cent”, said Gibb. Reuters