360 Finance, a Chinese digital consumer finance platform, announced that one of its subsidiaries has secured regulatory approval from the China Banking and Insurance Regulatory Commission to acquire 30% stake in Kincheng Bank of Tianjin.
Upon the deal’s closure, 360 Finance will become the largest shareholder in Kincheng Bank and the bank will become the third one in the country to be backed by the online financial services provider.
The deal was announced back in June this year. For a long time, the two companies have collaborated in areas such as technology and customer service.
The deal is expected to enable the companies to realise greater synergies.
In addition, the transaction will allow 360 Finance to strengthen its technology in the fintech sector through the financial services offered by the bank, which has expertise and experience in serving medium, small and micro-sized businesses.
The acquisition of Kincheng Bank provides 360 Finance with a banking license
The deal could also help the digital financial services provider in further bringing down its funding costs, expand customer base, while increasing the availability of loans through its digital platform.
360 Finance said that the acquisition allows it attain its goal of minimising regulatory uncertainties through gaining a comprehensive set of financial licenses.
Besides, the stake buy in Kincheng Bank provides it with a banking license, which is said to be difficult to obtain in China.
Founded in 2015 in Tianjin’s pilot free trade zone, Kincheng Bank of Tianjin is claimed to be one of the first five private banks to have received approval from the Chinese banking regulator as part of a pilot scheme to bring reforms to the financial sector.
360 Finance CEO and director Haisheng Wu said: “We are very pleased to see the transaction finally reached a successful conclusion.
“As a data driven, technology-empowered digital platform with particular strength in innovative product design and effective risk management, we expect to realize significant synergy between us and Kincheng Bank through strategic partnership.
“In the coming weeks, we will enter a series of agreements with Kincheng Bank to highlight the execution details related to all aspects of our partnership.
“We believe with such a deep-rooted relationship, we should be able to significantly expand the scope of our product and service offerings and continue to explore the application of digital technology in various scenarios, and ultimately to better satisfy the diverse needs of our users and institutional partners.”
