The chairman and head of the China Securities Regulatory Commission (CSRC), Xiao Gang, has been removed from his position, according to China’s state news agency.
Xiao Gang will be replaced by chairman of Agricultural Bank of China, Liu Shiyu, who has spent most of his career in banking.
Shiyu has previously served as vice governor of People’s Bank of China before joining Agricultural Bank of China as chairman.
Gang, who became chairman of CSRC in 2013, was tasked with overseeing the implementation of circuit breakers on stock markets.
CSRC and Gang were criticised last summer when Shanghai and Shenzhen stock markets plummeted by up to 40%.
Further criticism followed after the introduction of circuit breakers, which were implemented at the beginning of 2016 and were meant to prevent markets plummeting in volatile conditions.
Following a turbulent first week of trading in 2016, the circuit breakers were suspended as panic selling and erratic trading behaviour ensued, leading to markets closing on several days in January.
In a statement to the media at the time, the CSRC said: “…in order to maintain market stability, CSRC has decided to suspend the circuit-breaker mechanism.”
The Shanghai Stock Exchange said on its website that removing circuit breakers was a strategy to “keep the markets stable”.
Reports soon circulated that Gang was set to step down from his position after the disastrous events.
In an annual meeting of China’s National Securities and Futures Supervision, Gang said the events had, “fully exposed the loopholes in the Commission regulation.”