Observation of the decay $B^0 to eta K^*(892)^0$

We report a search for charmless hadronic decays of neutral $B$ mesons to $eta K^{*}(892)^{0}$. The results are based on a 711fb$^{-1}$ data sample that contains $772times 10^6 Boverline{B}$ pairs, collected at the $Upsilon(4S)$ resonance with the Belle detector at the KEKB asymmetric energy $e^+e^-$ collider. We observe the decay for the first time with a significance of 5.0 standard deviations and obtain its branching fraction ${cal B}[B^0toeta K^{*}(892)^{0}]=[2.6pm0.7{rm (stat)}pm0.2{rm (syst)}]times 10^{-6}$. We also measure the $CP$ violating asymmetry as ${cal A}_{CP}[B^0toeta K^{*}(892)^{0}]=-0.22pm0.29{rm (stat)}pm0.07{rm syst}$.