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VIB – Positive 2026F PBT growth supported by NIM expansion

• Full-year 2025 PBT amounted to VND 9.1 trillion, fulfilling only 83% of the full-year target (VND 11 trillion). PBT growth in 2025 was flat YoY due to the following factors: (1) credit growth in 2025 was capped at 17.7% (2024: 21.5%); (2) NIM narrowed significantly by 64 bps YoY to 3.1%; (3) non-interest income reached VND 1.8 trillion, down 12% YoY, mainly due to negative FX trading results of VND 154 billion (2024: a gain of VND 500 billion) and investment securities trading contributing only VND 80 billion (-68% YoY); (4) operating expenses amounted to over VND 7.4 trillion (+3% YoY). ROA and ROE declined sharply to 1.4% and 16.4%, respectively (2024: 1.6% and 18.1%).
• We forecast PBT growth of 24% and 22% in 2026–2027F, respectively, driven primarily by (1) credit growth of 15.9% and 16.5%, (2) NIM expansion amid higher lending rates, and (3) improving asset quality with well-controlled credit costs.
• Given the recovery prospects for profitability metrics and asset quality, we expect VIB’s P/B valuation to reach 1.4x over the next 12 months. Using a blended valuation approach: (1) the Residual Income Model and (2) P/B peer comparison, each assigned a 50% weighting, we derive a target price of VND 20,000 per share for VIB, implying a 23% total return (including VND 700 cash dividend) from the closing price of VND 16,850 on Mar 4, 2026.