Analyst Pin-board BID – 2022/2023 outlook: Strong earnings growth ahead with volatile credit costs
High base of provisions and concentration nature of large corporate loans are the reasons for uncertain earnings forecasts |
Credit costs were maintained in the range of VND 6-8 trillion each quarter in 2021, compared to VND 4-7 trillion in 2020 and VND 3-6 trillion a year earlier. Credit cost margin (TTM) was steepened from 4Q20 despite the decline in restructured loan balance. We forecast credit costs of VND 26.2 trillion in 2022 (USD 1.1 bn, -11% YoY), which should imply average credit costs of VND 6-7 trillion each quarter. On a quarterly basis, the base of provisions in 2022 is expected to be somewhat flat from 2021. Given BID’s high sensitivity to credit cost factor, we project volatile and elevated quarterly earnings growth throughout 2022
Joint Stock Commercial Bank for Investment and Development of Vietnam (BIDV) is a Vietnam-based financial institution. The Bank is engaged in the provision of commercial banking services to individual and corporate clients. Under personal banking business, it provides personal loans, deposits and money transfer services. Under corporate banking business, the Bank is engaged in credit activities, deposit taking, investment loans provision, international transaction settlement, gold trading and foreign exchange services. Through its subsidiaries, the Bank is involved in debt management, securities brokerage and insurance activities.
Viet Dragon Securities belongs to top 20 biggest securities companies in terms of chartered capital in Vietnam. With a qualified, dedicated and professional team, a widespread network, advanced technology, diversified products and services, and good relationship with local and foreign institutions, we provide a wide range of services and products to our clients both individuals and institutions, both local and foreign. We commit to provide our clients with promising investment opportunities and a comprehensive and professional financial investment services.
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