{"id":65798,"date":"2020-05-26T11:30:04","date_gmt":"2020-05-26T04:30:04","guid":{"rendered":"https:\/\/yuanta.com.vn\/?post_type=phan-tich&#038;p=65798"},"modified":"2020-06-05T14:43:47","modified_gmt":"2020-06-05T07:43:47","slug":"vpb-vn_down-shifting-to-lower-growth-mode","status":"publish","type":"phan-tich","link":"https:\/\/yuanta-uat.ysvn.com.vn\/en\/analysis\/vpb-vn_down-shifting-to-lower-growth-mode","title":{"rendered":"VPB VN_Down-shifting to lower growth mode"},"content":{"rendered":"<p><strong>HOLD-Underperform<br \/>\n<\/strong>TP upside (downside)\u00a0 \u00a0-6%<br \/>\nClose 25 May 2020<br \/>\nPrice\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 VND 24,000<br \/>\n12M Target\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 VND 22,500<br \/>\nPrevious Target \u00a0\u00a0 VND 25,530<br \/>\nChange\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 -12%<\/p>\n<p><span style=\"font-size: 14pt\"><strong>What\u2019s new?<\/strong><\/span><\/p>\n<ul style=\"list-style-type: square\">\n<li><strong>We slash our earnings forecasts<\/strong> by 27% for 2020E and 15% for 2021E.<\/li>\n<li><strong>We reduce our credit growth assumptions <\/strong>due to the impact of Covid-19.<\/li>\n<li><strong>NIM will decrease <\/strong>due to reduced overall loan yields and recalibrated focus toward secured loans.<\/li>\n<\/ul>\n<p><span style=\"font-size: 14pt\"><strong>Our view<\/strong><\/span><\/p>\n<ul style=\"list-style-type: square\">\n<li><strong>Downgrade to HOLD-Underperform<\/strong>.<\/li>\n<li><strong>VPB is trading at 1.1x 2020E P\/BV<\/strong>, in line with the sector, while our reduced 2020E ROE of 16% is lower than the sector median of 18%.<\/li>\n<li><strong>Risk to our view? FE Credit\u2019s IPO this year: <\/strong>We think it extremely unlikely, but we can\u2019t totally rule it out.<\/li>\n<\/ul>\n<p><strong>Reduced loan growth assumptions. <\/strong>We expect loan growth throughout the sector to weaken due to the impact of the Covid-19. Thus, we lower our 2020E loan growth forecast for VPB by -1ppt to 11% YoY.<\/p>\n<p><strong>NIM forecasts reduced <\/strong>by 14bps to 8.56% for 2020E<em>. <\/em>VPB has cut its lending rates for certain borrowers in line with SBV policy. The impact on NIMs should be exacerbated by its decision to focus more on secured loans and less on unsecured consumer loans.<\/p>\n<p><strong>SBV requires banks to restructure loan terms <\/strong>for borrowers affected by COVID while retaining pre-outbreak asset quality categorizations. According to <a href=\"https:\/\/baodauthau.vn\/tai-chinh\/vpbank-xu-ly-hang-nghin-ho-so-giam-gian-no-do-anh-huong-covid19-128558.html\">baodauthau.vn<\/a>, VPB has restructured VND12 trillion or 4.5% of its 1Q20 total loans as of May 4; notably, these assets are not classified as NPLs.<\/p>\n<p><strong>We assume VPB\u2019s credit costs will increase regardless of the deferred classification downgrades.<\/strong> We expect VPB to prudently recognize provision for such restructured loans.<\/p>\n<p><strong>We slash our PATMI forecasts by<\/strong> -27% for 2020E and -15% for 2021E, largely on our increased credit cost assumptions and reduced net interest income, but tempered by lower forecasts for the bank\u2019s operating costs.<\/p>\n<p><strong>Our reduced PATMI forecast are 14% below consensus<\/strong> for 2020. Our reduced forecasts for 2020 implies an earnings decline of -14% YoY.<\/p>\n<p><strong>We downgrade to HOLD-U\/P. <\/strong>VPB trades at 1.1x 2020E P\/BV which is in line with the sector median while our reduced ROE of 16% is slightly lower than that the peer median of 18%. Our target implies -6% total shareholder returns, justifying our recommendation downgrade<strong>.<\/strong><\/p>\n<p>For the complete report, please access here: <a href=\"http:\/\/yuanta-uat.ysvn.com.vn\/wp-content\/uploads\/2020\/05\/VPB_Company-Update_26.05.2020-1.pdf\">VPB_Company Update_26.05.2020<\/a><\/p>\n<p><strong>Analyst: Tanh Tran<\/strong>,\u00a0<em>tanh.tran@yuanta.com.vn<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>HOLD-Underperform TP upside (downside)\u00a0 \u00a0-6% Close 25 May 2020 Price\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 VND 24,000 12M Target\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 VND 22,500 Previous Target \u00a0\u00a0 VND 25,530 Change\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 -12% What\u2019s new? We&#8230;<\/p>\n","protected":false},"author":10,"featured_media":0,"template":"","class_list":["post-65798","phan-tich","type-phan-tich","status-publish","hentry"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v23.3 (Yoast SEO v23.4) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>VPB VN_Down-shifting to lower growth mode | Yuanta Vietnam<\/title>\n<meta name=\"description\" content=\"HOLD-Underperform TP upside (downside)\u00a0 \u00a0-6% Close 25 May 2020 Price\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 VND 24,000 12M Target\u00a0 \u00a0 \u00a0 \u00a0 \u00a0 \u00a0 VND 22,500 Previous Target \u00a0\u00a0\" \/>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"VPB VN_Down-shifting to 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