Fines are not a turning point; Industrial and Commercial Bank of China demonstrates operational resilience during compliance rectification?

Ask AI · How Can Ant Group’s Internet Merchant Bank Turn Compliance Rectification Into Business Resilience?

Produced by | China Visit Network

Reviewed by | Li Xiaoyan

On March 20, the Zhejiang Regulatory Bureau of the National Financial Regulatory Administration issued a 1.3 million yuan fine to Ant Group’s Internet Merchant Bank, pointing to illegal and non-compliant behaviors such as “rebate-attracting deposits,” and issued warnings to the relevant responsible persons as well. As a benchmark among private banks and internet banks, while this punishment has drawn market attention, it should also be seen as both a correction of past issues and a new starting point for the bank’s move toward high-quality development. Across multiple dimensions—compliance rectification, business resilience, and its inclusive finance mission—Ant Group’s Internet Merchant Bank is demonstrating a positive and improving development momentum.

This “rebate-attracting deposits” violation, in essence, is an industry-wide challenge in bank deposit-raising competition under interest rate marketization. In an environment where deposit interest rates continue to trend downward, some institutions attempt to indirectly boost depositors’ returns through cash rebates, gifts, and other methods to secure funding sources; such conduct crosses regulatory red lines and disrupts market order. The bank involved in this case is not an isolated example. Since 2025, more than ten banks have been penalized for similar issues, reflecting common compliance challenges across the industry. What is worth affirming is that Ant Group’s Internet Merchant Bank promptly and sincerely accepted the penalty, completed comprehensive rectification under regulatory guidance, proactively optimized its deposit-collection business processes, and established a long-term compliance mechanism—demonstrating a responsible attitude of facing problems head-on and correcting them once recognized.

From the perspective of its historical trajectory, Ant Group’s Internet Merchant Bank’s compliance journey is a microcosm of how private banks grow while exploring. Since its launch in 2015, with initial registered capital of 4 billion yuan, the bank has developed to a scale of 6.57B yuan today and has become an industry leader, serving tens of millions of small and micro business entities. During this process, compliance pains are inevitable. The two large-scale penalties in 2022 and 2024 both drove it to improve internal control systems. This fine further tightens accountability and embeds compliance awareness deeply into the entire business process. The regulator’s “dual-penalty system”—penalizing both institutions and responsible individuals—has also pushed Ant Group’s Internet Merchant Bank to strengthen management accountability, turning compliance operations from institutional requirements into a company-wide sense of responsibility.

On the operational front, Ant Group’s Internet Merchant Bank has demonstrated strong earnings resilience and scale strength. In the first three quarters of 2025, its asset size exceeded 520 billion yuan, up more than 10% from the start of the year, showing a steady expansion momentum. Although revenue fell slightly year over year by 1.05%, net profit reached 2.94B yuan, up 30.22% year over year. This “growth in profits without growth in revenue” performance is mainly attributable to improved risk management capabilities. Credit impairment losses decreased from 7.73B yuan in the same period last year to 7.734 billion yuan, a reduction of more than 1 billion yuan. This both reflects the effectiveness of improved asset quality and the cost optimization brought by refined risk control. At the same time, the foundation of its core business remains solid: Ant Merchant Loans (“Wangshang Dai”) continues to focus deeply on the small and micro market. Its wealth management business has cumulatively generated over 10 billion yuan in returns for users, becoming an important capital-management platform for small and micro groups.

Regarding asset quality, although the non-performing loan ratio rose to 2.30%, higher than the industry average, it needs to be assessed in light of the characteristics of its customer base. Ant Group’s Internet Merchant Bank has 70% of customers as credit-invisible (“credit white”) clients, and more than 60% are individual business owners. It is especially focused on county-level areas and agriculture-related sectors. Such entities tend to have weaker risk resistance, so their non-performing ratio is naturally higher than that of customer groups at traditional banks. Moreover, it uses a more stringent 30-day delinquency definition. If measured using the industry-standard 60-day definition, the non-performing loan ratio would drop to 2.00%. More importantly, the bank’s provision coverage ratio has been maintained at 200% or above; its capital adequacy ratio remains steady, indicating sufficient ability to withstand risks. Combined with its continued increase in AI-driven risk control technology investment, it is gradually building a more precise risk identification system.

As a private bank initiated by Ant Group, Ant Group’s Internet Merchant Bank has, since its founding, carried the mission of inclusive finance. It has cumulatively served more than 68 million small and micro businesses and rural customers, covering half of the agricultural counties across the country, injecting a steady stream of financial “water” into the real economy. This penalty is a compliance calibration, not a turning point for development. Instead, it is pushing the bank to find a better balance between innovation and compliance. Going forward, as rectification takes hold, risk control upgrades continue, and digital capabilities are further strengthened, Ant Group’s Internet Merchant Bank is expected to continue leveraging its advantages as an internet bank while staying firmly within the compliance bottom line—serving small and micro businesses in a more steady manner and helping the real economy—so as to go long and far on the path of high-quality development for private banks.