Core Viewpoint - The banking sector has shown strong performance, driven by style rotation and significant mid-term dividend distributions, with major state-owned banks leading the gains [3][5]. Group 1: Market Performance - On November 20, major banks experienced a rally, with China Bank rising over 5% and Industrial and Commercial Bank of China increasing by over 2%, both reaching historical highs [1]. - The China Banking Index has accumulated an 8.95% increase since the beginning of October, outperforming the broader market and exceeding the ChiNext Index by 15 percentage points [4]. Group 2: Dividend Distributions - A total of 24 listed banks have announced mid-term dividends, with a combined payout of nearly 263.8 billion yuan, marking a historical high [5]. - The six major state-owned banks are set to distribute a total of approximately 204.66 billion yuan in dividends, with most record dates concentrated in December [5]. Group 3: Investment Appeal - The banking sector is viewed as a defensive investment due to its low valuation and high dividend yield, making it attractive to investors seeking stability [5]. - As of the end of September, the China Banking Index had a price-to-book ratio of 0.67, placing it in the lower 35.69% percentile over the past decade, while the dividend yield reached 4.29%, significantly above the 10-year government bond yield of 1.88% [5]. Group 4: ETF Activity - The largest banking ETF (512800) saw its price rise by 1.9%, reaching a new high for the month, with a total trading volume of 1.491 billion yuan, indicating increased market interest [2]. - The banking ETF has experienced a significant increase in scale, reaching 20.615 billion yuan, reflecting strong investor demand [6].

Core Viewpoint - The banking sector in A-shares has shown strong defensive performance amid increasing market volatility, with significant gains in multiple bank stocks [1][3]. Group 1: Stock Performance - A total of 42 bank stocks in A-shares closed in the green, with notable gains including Shanghai Pudong Development Bank up by 5.66%, Chongqing Rural Commercial Bank up over 4%, and Nanjing Bank up over 3% [1][2]. - The Bank ETF (512800) demonstrated resilience, rising by 0.9% after reaching a peak increase of 1.4%, with a total trading volume of 2.187 billion yuan, reflecting a 41% increase in volume compared to the previous period [2][3]. Group 2: Market Dynamics - The reduction in tariff uncertainties has lowered market risk appetite, leading to increased demand for defensive asset allocations, particularly benefiting the banking sector [3]. - The banking sector attracted a net inflow of 3.482 billion yuan from major funds, with the largest bank ETF (512800) seeing a total net inflow of 763 million yuan over the past three days [3]. Group 3: Long-term Outlook - Institutions maintain a stable profit outlook for the banking sector, with expectations for slight positive profit growth in the second half of 2025, driven by improved interest margins and increased impairment contributions [5]. - The banking ETF (512800) tracks the CSI Bank Index, which has a price-to-book ratio (PB) of 0.67, indicating a low valuation compared to historical levels, and a dividend yield of 4.26%, enhancing its attractiveness in a low-interest-rate environment [5][6]. - Recent announcements from listed banks regarding mid-term profit distribution plans indicate a growing trend in cash dividends, with state-owned banks expected to distribute over 200 billion yuan in cash dividends, reflecting their stable profitability and capital adequacy [5][6].