BUSINESS PERFORMANCE

PBT continues to grow compared to the 2 previous quarters. PBT in Q3 increased 49%yoy.
Credit growth was recorded at 11%ytd, derived from a rapid expansion in mortgage which increased 22.3%ytd.
NIM stays intact at 4.5%, equivalent to the Q2 level, making VIB among the few banks to maintain NIM in Q3 despite the headwinds in the interest rate hikes environment.
Banking management is still doing well with NPL being under 2%, and declining restructured loans while CAR was stable at 12.4%.

COMMENT

The bank is stubborn in engaging in retail banking and digitalization. Following that, the credit card spending/people of VIB stayed highest in the banking system. Digitalization and dynamic card products help the bank to rapidly expand service fees while improving cost management (lower CIR).
The impact of the recent corporate bond events is not material to VIB thanks to the consistent strategy focusing on retail banking with a retail lending book proportion of 90%.
VIB now is having around 1% remaining credit room to tap the 13% limits. The bank would likely achieve the business plan this year with a PBT of around VND10,500 bn.

We recommend “outperform” with VIB stock.