South Korean banking stocks have outperformed as investors rotate from weakening semiconductor shares into value equities and the KOSPI remains range-bound. The KRX Bank Index gained 5.21% to 1,687.05 from August 24 to September 4, while the KOSPI Index fell 3.27% to 6,687.21. The broader MSCI Asia Pacific value index has risen roughly 6% this quarter, compared with a 2% decline for its growth counterpart, as Asian financials gained 12% while semiconductor shares weakened. High interest rates can support banks because lending rates typically rise faster than deposit rates, widening net interest margins, while a stronger won can generate foreign-exchange gains and improve Common Equity Tier 1 ratios. The outlook remains dependent on exchange-rate stabilization, domestic and U.S. interest rates, Federal Reserve policy, inflation data and semiconductor earnings guidance.