Core Viewpoint - The issuance of perpetual bonds in the primary market significantly declined in August, primarily due to the absence of state-owned banks and a shift in their issuance strategy towards TLAC bonds [1][2]. Group 1: Market Activity - In August, only 12 perpetual bonds were issued, totaling 71.8 billion yuan, a decrease of over 160 billion yuan compared to July, marking the first month of net outflow this year with a net financing amount of -71.45 billion yuan [1]. - State-owned banks, particularly China Bank, were the only major issuer with a 40 billion yuan perpetual bond, while smaller banks like Chengdu Bank and Rizhao Bank became the main contributors to the market [1]. - The issuance of TLAC bonds reached 800 billion yuan this year, which has created competitive pressure on traditional perpetual bonds, leading to a notable decline in issuance from state-owned banks in August [1]. Group 2: Issuance Trends - The cautious approach of state-owned banks contrasts with the enthusiasm of smaller banks, which have actively supported the perpetual bond market, with nine city commercial banks completing issuances in August [2]. - The issuance pattern of "large banks stabilizing volume while small banks accelerate issuance" is expected to continue, reflecting the differing capital pressures faced by various types of banks [2]. - The perpetual bond market experienced its first month of negative net financing, primarily due to a wave of redemptions, with a significant increase in redemption amounts in September [2]. Group 3: Investor Behavior - Public funds and trading desks have been selling off perpetual bonds due to stock market sentiment, with a net outflow exceeding 27 billion yuan on a single day in mid-August [3]. - Conversely, bank wealth management and insurance funds have been increasing their holdings, particularly in the 3-5 year maturity range, as the yield on long-term perpetual bonds has deviated significantly from earlier lows [3].