The world's biggest stock sale proved extremely popular with large and small investors. Privately, however, some Ant employees were worried about potential regulatory changes that could hurt the company's growth prospects, according to people familiar with the matter.
On Oct. 24, Mr. Ma took the stage at a financial forum in Shanghai attended by top regulators, politicians and bankers. He said Ant's IPO was "a miracle," being such a large deal taking place away from New York. Attendees included China's Vice President Wang Qishan, central bank governor Yi Gang and some senior state-bank executives.
During his 21-minute speech, he criticized Beijing's campaign to control financial risks. "There is no systemic risk in China's financial system, " he said. "Chinese finance has no system."
He also took aim at the regulators, saying they "have only focused on risks and overlooked development." He accused big Chinese banks of harboring a "pawnshop mentality." That, Mr. Ma said, has "hurt a lot of entrepreneurs."
His remarks went viral on Chinese social media, where some users applauded Mr. Ma for daring to speak out. In Beijing, though, senior officials were angry, and officials long calling for tighter financial regulation spoke up.
After Mr. Xi decided that Ant's IPO needed to be halted, financial regulators led by Mr. Liu, the leader's economic czar, convened on Oct. 31 and mapped out an action plan to take Mr. Ma to task, according to the government officials familiar with the decision-making.
At a meeting of the Financial Stability and Development Committee headed by Mr. Liu, the group decided to "put all kinds of financial activities under regulation and treating the same businesses in the same way," according to a government statement.
The decision was aimed squarely at Ant, the government officials said, and cleared the way for the pro-stability members of the group to dust off draft regulations they had been working on for a long time.
Among them was one regulating online microlending. With Mr. Xi's blessing, the central bank and the banking regulator made the draft rule even tougher than previously conceived, according to the Chinese officials familiar with the decision-making. The new rule had a requirement that didn't exist in previous drafts: Firms such as Ant would need to fund at least 30% of each loan it makes in conjunction with banks.
The draft rules were published on Nov. 2, the same day Mr. Ma and a couple of his executives at Ant were summoned to a rare joint meeting with the central bank and the regulatory agencies overseeing banking, insurance and securities.
The next day, the Shanghai Stock Exchange suspended the Ant IPO, citing the meeting and changes in the regulatory environment. The China Securities Regulatory Commission, which previously signed off on the listings, now says it was a "responsible move" to protect investors and markets, as the regulation, once implemented, would severely limit Ant's business scope and profitability.
Ant could try again to go public. Market participants believe it will reorganize its business units, rethink its business model and inform investors of additional risks. All this likely will mean that Ant's lofty valuation will be cut when it tries to list again, and the company may not be able to raise as much money as it aimed for this round, analysts say.
Mr. Ma hasn't made any public comments since the offering collapsed.
Write to Jing Yang at Jing.Yang@wsj.com and Lingling Wei at email@example.com
(END) Dow Jones Newswires