VCB – Healthy growth prospects
- PBT reached VND 7.6 tn in 3Q22 (+32% yoy), mainly coming from interest-earning assets expansion and NIM improvement. NII and TOI were recorded at VND 13.7 tn and 16.7 tn, respectively.
- The bank has utilized almost fully credit growth quota granted of 9M22 to make up a 17.3% growth ytd. There has been a certain gap between credit and deposit of the overall system as deposit growth reached 5.4% ytd as of 3Q22. CASA ratio declined to 33.8% after peaking at the historical high of 34.5% in 2Q, yet remained a favorable figure.
- NPL ratio increased to 0.8% in 3Q22 while net NPL formation rate maintained a steady downward movement to reach a minor level due to the expiration of Circular 03 regarding the Covid-19 restructured loans. The coverage ratio stayed at the highest level among industry peers of 401.8%. In addition, VCB has shown a comparatively healthy growth prospect amid the recent turbulence on corporate bond and real estate market due to its stringent assets allocation policy.
- We revised our forecasts in 2022 and 2023 to factor in (1) the potential of a delayed private placement due to unfavorable market conditions and (2) High credit quota to net off the decline in NIM due to the support package. Altogether, TOI is forecasted to increase by roughly 9%, driving by an 9.5%%/12% growth of NII/NFI. Credit cost margin somewhat decrease thanks to top-tier provision buffer. As a result, PBT are forecasted to slightly rise by single digit in 2023. The target price is revised down to VND 90,200/share due to the delay of the private placement and decline of earnings forecast in FY22 and FY23. As of Dec 21st, 2022, this stock offers an upside of 14%, hence, investor can ACCUMULATE this stock.
Joint Stock Bank for Foreign Trade of Vietnam is a commercial bank. Through its subsidiaries, Co. is engaged in banking transactions, including mobilizing short, medium and long term deposits from economic entities and individuals; providing short, medium and long term loans to various economic entities and individuals; conducting foreign exchange transactions; international financial and commercial services; discounting commercial notes, bonds and other valuable papers and other banking services. As of Dec. 31, 2012, Co. has about 400 branches/ transaction offices/ representative office/ affiliates both in Vietnam and abroad.
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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