Ant-Backed Rural Lender and Micro-Insurance Firm, Chongho, Eyes $500M HK IPO

Chongho Bridge Credit Agricultural Group Co., a Chinese rural bank that offers microcredit and micro-insurance to small businesses, is considering a Hong Kong initial public offering that could raise as much as $500 million, according to people familiar with the matter.

The Ant Group Co.-backed company is working with China International Capital Corp. and UBS Group AG on the preparations of the listing, which could happen as soon as next year, the people said. The share sale could raise $300 million to $500 million depending on market conditions, said the people, who asked not to be identified as the information is private.

Considerations are at an early stage and details of the IPO such as the bank lineup and timing could change, the people said. Representatives for CICC and UBS declined to comment, while a representative for Chongho Bridge didn’t respond to requests for comment.

Chongho Bridge traces its roots to 1996 as a microcredit pilot in World Bank’s poverty reduction project in western China, its website shows. The firm was formally founded in 2008 and International Finance Corporation and Sequoia Capital joined as shareholders two years later. Chongho Bridge has a presence in 20 provinces in China with about 89% of its clients being farmers.

Ant Group invested in Chongho Bridge in 2016. The lender raised 1 billion yuan ($137 million) in a 2021 funding round led by Ontario Teachers’ Pension Plan Board. Chongho Bridge also counts TPG’s Rise Fund and ABC World Asia, an impact investing firm under Temasek Trust Asset Management, as backers.

Photograph: The Ant Group Co. logo inside the company’s headquarters in Hangzhou, China, on Saturday, May 8, 2021. Photo credit: Qilai Shen/Bloomberg