银行投资观察：业绩增速回升，周期见底可期

Investment Rating - The report rates the banking industry as "Buy" [1] Core Views - The performance of the banking sector is recovering, with expectations of a bottoming cycle [1][34] - The overall performance of the banking sector has declined, with a 1.55% drop compared to a 0.9% drop in the Wind All A index, ranking 21st among all industries [32] - A-share banks showed a slight recovery in profit growth, with net profit growth of 1.4% year-on-year for the first three quarters of 2024 [34] Summary by Sections 1. Sector Performance - The banking sector's performance has weakened relative to the market, with H-shares outperforming A-shares [32] - The average price of bank convertible bonds fell by 0.68%, underperforming the Zhongzheng convertible bonds by 0.14 percentage points [33] 2. Investment Recommendations - The report suggests that the banking sector's performance is expected to improve in the second half of next year, driven by policies aimed at boosting consumer spending and increased fiscal expenditure [34][38] - Recommended banks include China Merchants Bank and Ningbo Bank, which are expected to perform well due to their high proportion of demand deposits and fee income [38] 3. Profit Forecast Tracking - The report indicates that the net profit growth and revenue growth expectations for A-share banks in 2024 have increased by 0.41 percentage points and 0.17 percentage points, respectively [33] - The first three quarters of 2024 saw a year-on-year revenue decline of 1.0%, with a slight recovery in the third quarter [34][36] 4. Individual Stock Performance - The top-performing A-share banks included Changsha Bank (+4.45%), Qilu Bank (+4.22%), and Chongqing Bank (+3.79%) [32] - The worst performers were Industrial Bank (-4.44%), Postal Savings Bank (-4.19%), and Suzhou Bank (-4.16%) [32] 5. Credit and Asset Quality - The overall non-performing loan ratio for A-share banks remained stable at 1.25% [37] - The report anticipates that credit costs will decline, leading to a gradual convergence of profit growth towards revenue growth [37]