{"id":48476,"date":"2020-02-27T10:48:56","date_gmt":"2020-02-27T03:48:56","guid":{"rendered":"https:\/\/yuanta.com.vn\/?post_type=phan-tich&p=48476"},"modified":"2020-06-26T15:33:47","modified_gmt":"2020-06-26T08:33:47","slug":"tcb_4q19-analyst-meeting","status":"publish","type":"phan-tich","link":"https:\/\/yuanta-uat.ysvn.com.vn\/en\/analysis\/tcb_4q19-analyst-meeting","title":{"rendered":"TCB_4Q19 Analyst Meeting"},"content":{"rendered":"

Not Rated<\/strong><\/span><\/p>\n

TP upside\/(downside) N\/A
\nClose 26 Feb 2020
\nPrice\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0: VND 22,350
\n<\/strong>12M Target\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0: N\/A<\/strong><\/p>\n

 <\/p>\n

Event: 4Q19 Analyst Meeting<\/strong><\/span><\/p>\n

TCB held an analyst meeting on Feb 26, 2020 to discuss their business results for 2019. The bank also announced the appointment of a new CEO this September.<\/p>\n

Key Takeaways<\/strong><\/span><\/p>\n

4Q19 PBT reached VND3.9 tn, up 24.4% QoQ and up 37.8% YoY. <\/strong><\/p>\n

2019 PBT was VND12.8 tn (+20.4% YoY),<\/strong> beating the bank\u2019s full-year target by 9%. Management clarified that there was no one-off income contributing to 2019 PBT, unlike in the 2015-18 period.<\/p>\n

Net interest income (NII) <\/strong>reached VND3.9 tn in 4Q19 (+7.8% QoQ\/+29.3% YoY). 2019 NII of VND14.3 tn was up 25.2% YoY. Retail banking accounted for 49% of total NII in 2019 (+9ppt YoY). The bank reported 2019 NIM of 4.20% (+50 bps YoY), as its improved CASA deposit franchise drove reduced funding costs.<\/p>\n

Provisioning was VND0.9 tn in 2019 (-50% YoY). <\/strong>Provisoning fell to 0.4% of loans in 2019 (-40bps YoY).<\/p>\n

Strong capital adequacy<\/strong>. TCB\u2019s Basel II CAR ratio reached 15.5% in 2019 (+90bps YoY), the highest in the sector and far above the 8.0% minimum. In addition, the bank\u2019s yearend asset\/equity leverage ratio was just 6.2x, the lowest in the sector.<\/p>\n

TCB\u2019s CASA ratio was 34.5% (+5.8ppt YoY) at end-2019<\/strong>, which was just behind MBB<\/a> (BUY) and the second highest in the sector. Short-term funding used for medium-to long-term loans was 38.4%, complying with the 2019 required minimum of 40.0%.<\/p>\n

Room for further growth<\/strong>. 2019 LDR ratio of 76% was below the SBV\u2019s requirement of 85%. Given its strong capital adequacy, the bank could receive a higher SBV credit growth quota than the sector average.<\/p>\n

Our view.<\/strong> We don\u2019t cover TCB and have no recommendation on the stock. However, TCB persistently ranks highly in our proprietary CAMEL analytical framework (see our 4Q19 CAMEL <\/a>note for details).<\/p>\n

Valuation is low despite high profitability<\/strong>. Based on Bloomberg consensus for 2020E, TCB trades at 1.1x P\/BV with ROAE of 17% (recalling that ROE is constrained by low balance sheet leverage) compared to the sector average 1.2x P\/B and 20% ROAE.<\/p>\n

Of course, the FOL premium alters the valuation consideration for FINIs, but on-exchange opportunities have emerged<\/strong> amid the recent market rout with blocks crossing at limit-up and without the settlement woes of off-exchange FOL deals. Short-term upside catalysts might include the VNFIN LEAD ETF (TCB is 12.6% of the index) and the VNDiamond ETF (if it is passed).<\/p>\n

For the complete report, please access here: TCB_Analyst Meeting Takeaways_26.02.20<\/a><\/p>\n

Analyst: Tanh Tran<\/strong>,\u00a0tanh.tran@yuanta.com.vn<\/em><\/p>\n

 <\/p>\n","protected":false},"excerpt":{"rendered":"

Not Rated TP upside\/(downside) N\/A Close 26 Feb 2020 Price\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0: VND 22,350 12M Target\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0: N\/A   Event: 4Q19 Analyst Meeting TCB held an analyst meeting on Feb 26, 2020 to discuss their business results for 2019. 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