VCB [BUY +20.1%] - Traditional drags on NIM recede to let retail lending shine - Update
We reiterate our rating for VCB as BUY and roughly hold our TP at VND72,000 offering 20% upside. TP is the result of upward push from NIM revision and downward tug from higher equity risk premium. We see the 10% private placement to be signed in H2 2018 and will be factored into this update. We believe this to be the catalyst to move VCB away from current “sleepy” LDR. Net interest income (NII) is expected to grow at 30.4% Y-o-Y helped by a 32-bps rise in consolidated NIM.