GTJASVN_ACB Equity Report_Business Results Update_Accumulate Recommendation_25.500VND_29.7.2025

UPDATE ON BUSINESS OPERATIONS

Credit increased 9.1% YTD, below the industry average. This result reflects the challenges ACB faces in expanding its credit portfolio amid a difficult Southern credit market in 1H (according to the bank). Contributing to the credit-growth momentum in 1H, the retail and SME segments (accounting for approximately 90% of outstanding loans) rose +7.7% and +5.6% YTD, respectively, while large-corporate lending (MMLC) surged +25.1% and FDI lending jumped +71%, indicating headroom to further accelerate the bank’s lending In 1H, ACB recorded profit before tax of VND 10,690 billion, with modest growth of +2% YoY, achieving 46% of its annual plan. Non-interest income rose +39% YoY, offsetting the decline in NII and a compressed NIM of 3.27% due to competitive deposit rates and elevated funding costs. Asset quality control remains a strength: the NPL ratio fell to 1.26% (non -CIC NPL at 1.18%), and the loan-loss coverage ratio rose to 76%. There is no corporate-bond exposure, and real-estate lending remains low. CAR reached 11.08%, still above the minimum requirement after dividend distribution and the ACBS capital increase. ROA reached 2%, and ROE reached 20.6%, keeping ACB among the system leaders.

ASSESSMENT

We are confident in ACB’s long-term business prospects, given its client base and core strengths in SMEs and retail customers—key priorities of the economy and aligned with Resolution 68 on the private sector, which aims to grow the SME count to 2 million by 2030 (nearly three times today’s level). We maintain an ACCUMULATE recommendation on ACB shares, based on (1) a consistent credit strategy with strong asset-quality control and no corporate-bond risk; and (2) superior profitability (ROE > 20%) despite temporary margin compression.