China Merchants Bank Co. and other state-backed lenders have emerged as the biggest winners from new regulations that derailed Ant Group Co.’s massive stock listing, as China aims to level the playing field between fintech giants and traditional banks.

Merchants Bank, known as the retail bank king in China, has soared 18% in Hong Kong this month, its biggest seven-day advance in more than five years. The stock rose as much as 3.6% on Tuesday to a record high. Other Chinese lenders gained, including Agricultural Bank of China Ltd., while Alibaba Group Holding Ltd., an affiliate and one-third shareholder of Ant, lost 4%.

Chinese banks, trading near record low valuations, rallied after financial regulators last week proposed new rules to curb the rapid growth and leverage at the nation’s more than 200 micro-loan lenders, putting a surprise halt to Ant’s US$35 billion ($47.07 billion) initial public offering.

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