now, let me briefly touch on how we build the financial safety net in china. china attaches great importance to preemptive prevention and resolution of financial risks. we followed the principle of " prevention of excessive build - up of financial risks ex ante, and swift and efficient resolution ex post ". towards this end, we have made great efforts on the following fronts : the first is to enhance the corporate governance and risk management of financial institutions. sound financial institutions are the groundwork of the financial safety net. at the beginning of this century, the chinese authorities successfully restructured some large state - owned banks. now, these banks have become main pillars of china's financial system in supporting china's fast and sustained economic growth over the years. 2 / 3 bis - central bankers'speeches the second is to strengthen financial regulation. financial regulation is the first line of defense of the financial safety net. we have adapted our financial regulatory regime to changes of the financial market and financial system. the objectives are to optimize the functions and enhance the synergy of macro - prudential, micro - prudential and conduct regulation. the third is to reinforce resources for risk resolution. in china, we have deposit insurance fund, insurance security fund, securities investor protection fund, trust protection fund, and financial stability fund. these funds have already accumulated some financial resources. established in 2015, the deposit insurance scheme now provides full protection for over 99 percent of depositors with a coverage ceiling of rmb500, 000. it charges risk - based differentiated premiums to encourage prudent operation and early risk correction. the fourth is to act as the lender of last resort. the pboc has played a crucial role in large bank restructuring and reform, financial risk resolution, and prevention of systemic financial risks. thanks to the efforts over the years, we have maintained financial stability in china. the fifth is to step up legislative efforts on financial stability. china is formulating the financial stability law. we aim to establish a risk resolution mechanism with wellaligned responsibilities and rights, compatible incentives and constraints, and reasonable cost sharing. ladies and gentleman, strengthening the asian financial safety net requires solidarity and collaboration of all parties. the pboc stands ready for close communication and collective action to build a more effective financial safety net. thank you. 3 / 3 bis - central bankers'speeches

in economic functioning. the chinese government has taken a series of policies to effectively mitigate risks related to local government debt and the real estate market. up to now, these risks are contracting on the whole. in terms of local government debt, the chinese government debt level is in the middle - to - lower range internationally. the debt burden on the central government is not 2 / 6 bis - central bankers'speeches heavy while the debt risks of the local governments are mainly concentrated in some less - developed regions. in recent years, we have taken a series of measures to enforce strict financial discipline and control new debts. we have guided financial institutions to, following the market principle and the rule of law, consult on an equal footing with financing vehicles, and restructure their debts through rollover, paying off old debts with new loans, and debt swap. the aim is to gradually transform those financing vehicles into market - oriented enterprises. up to now, the number of local government financing vehicles and their debt scale have both plunged, indicating a contraction of risks. to further defuse risks related to local government debt, the cpc central committee has decided to raise the debt ceiling of local government by rmb6 trillion, and allocate rmb4 trillion in the newly - issued local government special bond to swap the existing implicit debts. the two combined will provide funds worth of rmb10 trillion, which will significantly reduce the pressures on local governments in defusing debts, and mitigate the debt risks of local financing vehicles. in terms of the real estate market, after long - cycle prosperity for nearly three decades, china's real estate market has experienced a fundamental shift and is now looking for a new point of equilibrium. we have implemented a mix of policies from both demand and supply sides, such as removing restrictions on housing purchase in medium - and large - sized cities, optimizing real estate financial policies ( lowering the down payment ratio and mortgage rates, and establishing a financing coordination mechanism ), and improving relevant tax policies. meanwhile, the market entities worked hard to heal and improve themselves by adjusting their operation strategies and restructuring their debts. with these efforts, the risks of the real estate market have been greatly mitigated and the transactions increased overall. since october 2024, the floor area of for - profit housing sold in 30 medium - and large - sized cities has grown for three consecutive months on a month - on - month basis and for two straight months on a year - on - year basis.