China Galaxy Securities pointed out that due to the decline in LPR, repricing, and the rigidity of debt-side costs, the performance growth of listed banks in 2023 was under pressure. Interest spreads were the main drag, and the effect of price compensation was weakened by volume. There is plenty of room for optimization at the credit investment structure level, and fields such as small and micro, science and innovation, private sector, and green finance are expected to maintain a high level of prosperity. Looking ahead to 2024, credit will maintain reasonable growth, the pace of investment will be more balanced, and structural optimization will be the main feature. Monetary policy will pay more attention to quality and efficiency, and continuously enrich the monetary policy toolbox. At the same time, supervision has strengthened the control of capital idling, affecting short-term bank expansion, but it will open up space for optimizing business structures and transforming business models. At this stage, bank valuations are at a moderately low level since 2020, and dividend ratios have been rising steadily. We continue to be optimistic about the banking sector's allocation value.