second, fostering the development of qualified institutional investors. the development of money market fund business and the establishment of fund management companies by commercial banks will be supported. currently, the provisional rules for money market fund management and the administrative rules for the establishment of fund management company by commercial banks have been released. the pbc, jointly with other relevant government departments, will further promote the pilot project according to the rules so as to enable commercial banks to establish fund management company and issue funds at an early date. meanwhile, to enhance the opening up of the 3 / 4 inter - bank bond market, qualified foreign institutional investors such as the asian bond fund will be allowed to invest in the market. third, strengthening the infrastructure construction of the inter - bank bond market. to ensure the smooth introduction of various new types of financial products, efforts will be made to reinforce market infrastructure and improve the legal system so as to provide legal and technical support to the healthy development of the inter - bank bond market. relevant rules and regulations will be further improved. in addition to the existing regulatory rules, the administrative rules for the inter - bank bond market will be drafted. meanwhile, the pbc will specifically define its supervisory functions, and clarify certain important principles based on which bond is issued and traded. steps will also be taken to further improve development of rules, contracts and system regarding the dvp settlement in the inter - bank bond market, explore the ways of adopting dvp settlement by non - banking financial institutions, and establish relevant systems. certain issues such as the data exchange and sharing will be coordinated so as to foster the linkage between the bookkeeping system and the trading system. the management of the trading information in the inter - bank bond market will be strengthened. the pbc will also further improve the market - maker system, increase policy support to the market makers and gradually put in place a inter - bank bond market with the market makers as the core, the brokers and financial institutions as the mainstay, and the non - financial investors as the major participants. i am confident that, with the efforts of all parties in china ’ s bond market, the chinese bond market is bound to see a rapid and healthy development. thank you! 4 / 4

of bonds in inter - bank bond market amounted to rmb5214. 3 billion yuan, growing by rmb1859. 2 billion yuan over the end of 2003, up 35. 65 percent. the total market turnover was rmb15. 4 trillion yuan for the same period of time. market participants increased rapidly in greater diversity. by the end of this march, there were altogether 5596 institutional participants in the market including banks, securities firms, mutual funds, insurance companies, and other non - banking financial institutions and enterprises, 1613 more than that recorded at the end of 2003. second, significant progress has been made in product innovation. since last year, the pbc has made great efforts in promoting financial product innovation, expanding bond issuers and developing financing channels, including allowing commercial banks to issue subordinated bonds, supporting the implementation of the pilot share - holding reform of banks as approved by the state council, introducing short - term financing bills to widen financing channels for the securities firms, encouraging international development institutions to issue rmb bonds in domestic market, improving the bond market and promoting the opening - up of the financial market. in the near term, by introducing shortterm corporate financing bills, we have made important strides in enhancing the capability of enterprises to directly raise funds in the market. with the increase of bond issuers, bond products became more diversified. the pilot program of asset securitization was explored and advanced. to promote the pilot program on the securitization of mortgage loans and credit assets in the banking sector, the pbc, jointly with the china banking regulatory commission, issued the administrative rules on the pilot conduct of credit asset securitization, which advanced the financial innovation. in terms of bond issuance, the agricultural development bank of china was approved to issue policy financial bonds to make its funding more market - oriented. a new bond product with floating interest rate based on the new benchmark rate was introduced in the market, which has enriched financial 1 / 4 products and investment instruments. in terms of bond transactions, certain types of corporate bonds such as railway construction bonds started to be traded in the inter - bank market, leading to extended market coverage. the introduction of outright repo business paved the way for interest rate derivatives transactions such as bond credit and forward transactions. third, market infrastructure was reinforced. the pbc has taken active steps to strengthen infrastructure construction, foster the development of qualified institutional investors and improve relevant legal framework. first, efforts were