Market stability ascended atop our agenda in the trying time of unusual circumstances at home and abroad. We fully respected the market and allowed it to play its role. When trading on the stock market resumed on time, against all odds, it sent a strong message of economic revival across the country after this year's extended Spring Festival holiday. We coordinated better policies, balanced market expectations, closely monitored cross-market and cross-border risks with protections made, and moved ahead with reforms on both investment and financing sides to draw in more medium- and longer-term capital. China's stock market ended 2020 on an even note. The market was more resilient and dynamic with a healthy investor structure, as with the bond and futures markets, where commodities prices effectively withstood external shocks.

In 2019, we rolled out the roadmap for deepening reform of the capital markets in 12 areas, among which the centerpiece initiative—the STAR market, made significant breakthroughs. Using this momentum, we pressed ahead to consolidate the fundamental framework of the capital markets. Piloting registration-based IPO regime on the ChiNext. Introducing full-scale reform of the National Equities Exchange and Quotations (NEEQ). Raising the quality of listed companies and revising delisting rules to ensure smooth market exits. Easing compliance burden by canceling or modifying 14 administrative licensing procedures and streamlining the rulebook as the new Securities Law came into force. Further expanding market access with a more inclusive arrangement to increase foreign participation in the capital markets.

To gain the upper hand in forestalling financial risks, we adopted targeted resolutions for each sector, gave equal weight to resolving remaining issues and preventing new ones, and delivered concrete progresses on various fronts. As a result, fewer listed companies were tagged as high-risk. Companies with a high share pledge ratio by the biggest shareholders were halved from a previous peak, and the outstanding balance of share pledge loans decreased by more than 35%. On the exchange-traded bond market, risks were effectively tamed. The default rate was largely within control as we unified disclosure rules and facilitated the release of the Minutes of the National Symposium on Court Trials of Disputed Bond, which offers guidance on resolving risks from individual cases. To reduce the risk exposure of private funds, we helped establish a working mechanism between ministries and central and local governments to take holistic measures. We also steadily and cautiously treated risks in regional trading venues and cut down financial institutions' non-compliant investments in non-standard assets.

Zero tolerance calls for substantially intensifying punishments and deterring illegal conduct in the capital markets. In 2020, we stepped up efforts to smooth the collaboration between administrative enforcement authorities, civil recourse, and criminal sentences. As the new Securities Law and Amendment XI to the Criminal Law took effect in succession, it ended the enduring situation where legal punishments were too light to deter violations. Legislation of the Futures Law kept going forward. The Central Commission for Comprehensively Deepening Reform reviewed and approved Several Opinions on Vigorously Combatting Illegal Securities Activities to improve capital markets' judicial and law enforcement systems. We further ramped up efforts to crack down on fraudulent offering, financial fraud, and other serious violations and imposed heavy punishments in several closely watched cases. Regarding investor protection, we contributed to releasing the judicial interpretation on representative action for securities disputes and launching China's first representative action against a listed company.