BUSINESS RESULTS

Credit increased by 4.6%ytd. Profit before tax in the first half of the year reached nearly VND 10,000 bn, up 11% yoy and reaching 50% of the profit target in 2023. In which, interest income increased by 13% and non-interest income increased by 28%.

The bank’s NIM narrowed to 4.02%. NPL ratio increased to 1.07%.

In the first half of the year, the bank has completed paying dividends for FY2022 (15% share dividend and 1,000VND/share cash dividend).

Business Expectations: The large credit growth limit of 14.5% (given by SBV) gives the bank more room to lend in the second half of the year. However, pressures on the lending market and the support interest rates package will pressure the bank’s NIM. The bank’s provision expense pressure is expected to decline in the second half of the year with the expectation of the provision reversal.

RECOMMENDATION

We maintain the same valuation of ACB as previously reported at VND24,700/share (after adjusting the dividend payout ratio for the first 6 months). ACB is suitable for the holding portfolio due to its solid business model, prudent risk appetite and first-class safety in the system.