Investment Rating - The report maintains an investment rating of "Outperform the Market - A" for the banking sector [4]. Core Insights - The profit growth rate of banks continues to improve, driven by robust growth in interest-earning assets, particularly in bond allocation and corporate credit lending [1][2]. - The net interest margin (NIM) decline is gradually narrowing, with a positive impact on net interest income due to rapidly decreasing deposit costs [1][3]. - The banking sector is experiencing a shift towards longer-term deposits, with the proportion of 1-5 year deposits increasing from 10.6% to 23% [1]. - The report highlights a significant decrease in the holdings of bank stocks by active public funds, reaching a historical low of 1.71% [8][9]. - Despite the decline in active fund holdings, insurance funds have significantly increased their investments in major state-owned banks [9]. Summary by Sections Profit Growth and Credit Quality - The third-quarter reports indicate a continuous improvement in profit growth, with state-owned banks showing the best performance [3]. - Credit risk remains manageable, with improvements in the quality of corporate credit assets, particularly in reducing exposure to financing platforms [2][3]. Market Dynamics and Investment Sentiment - The banking sector's valuation and dividend yield have become more attractive for long-term investors, despite a general decline in interest from active funds [9]. - The report suggests that banks with a higher proportion of credit business and stronger non-interest income advantages will exhibit more robust performance [8]. Future Outlook - The re-pricing of deposits is expected to have a positive effect on reducing liability costs, supporting net interest income growth [8]. - The report recommends focusing on major state-owned banks, China Merchants Bank, Ningbo Bank, and Chengdu Bank as potential investment opportunities [10].