China has suspended Ant Group’s $US37 billion ($A52 billion) stock market listing, thwarting the world’s largest IPO with just days to go in a dramatic blow to the financial technology company founded by billionaire Jack Ma.

The Shanghai stock exchange announced that it had suspended the company’s initial public offering (IPO) on its STAR Market, prompting Ant to also freeze the Hong Kong leg of the dual listing, which was due on Thursday.

The move followed a meeting between Ma and China’s financial regulators on Monday during which Ma and his top executives were told the company’s lucrative online lending business would face tighter scrutiny, sources told Reuters.

The Shanghai bourse described Ant’s meeting with financial regulators as a “major event” and said the showdown, plus a tougher regulatory environment, disqualified Ant from listing.

In China, analysts interpreted the move as a slap down for Ma, who had wanted Ant to be treated as technology company rather than a highly regulated financial institution.

“The Communist Party has shown the tycoons who’s boss. Jack Ma might be the richest man in the world but that doesn’t mean a thing. This has gone from the deal of the century to the shock of the century,” said Francis Lun, CEO of GEO Securities.

To revive its listing, Ant is trying to establish if it needs to disclose more information to the Shanghai exchange about its relationship with regulators, or if the bourse expects it to resolve all its issues with the regulators, which would take much longer, a person with knowledge of the matter said.

At a public event last month, Ma called China’s financial regulation outdated and badly suited to companies trying to use technology to drive financial innovation.

Ant believes that public criticism put Ma in the crosshairs of regulators, said the person.

The suspension of the listing reverberated across markets, with Alibaba Group Holding – which owns about a third of Ant – falling 9.0 per cent in US trading.

That wiped nearly $US76 billion off its value, more than double the amount Ant was planning to raise through its IPO this week.

“This is a curve ball that has been thrown at us … I don’t know what to say,” said one banker working on the IPO.

Officials in Beijing have become more uncomfortable with banks heavily using micro-lenders or third-party technology platforms such as Ant for underwriting consumer loans amid fears of rising defaults and deteriorating assets in a pandemic-hit economy.

Ant apologised to investors for any inconvenience caused by the IPO delay.

“We will properly handle the follow-up matters in accordance with applicable regulations of the two stock exchanges,” it said.

The company said it would release further details on the suspension of its Hong Kong listing and on applications for refunds as soon as possible.