- 2024-01-19T00:00:00
- Company Research
TPB released its results for 2023 with TOI of VND12.4tn (USD671mn; +4.0% YoY) and NPAT of VND4.5tn (USD184mn; -28.7% YoY), achieving 101.2% and 83.5% of our full-year forecasts, respectively. Q4 2023 NPAT was VND1.5tn (-60.8% QoQ and -67.5% YoY). We see a potential downside risk to our earnings forecast for TPB, pending a fuller review.
• 2023 credit growth was strong at 19.0% YoY and concentrated in Q4 2023 with loan growth increasing 15.7% QoQ while corporate bonds decreased 23.4% QoQ. Three sectors that contributed most to Q4 2023 loan growth include (1) retail +13.7% QoQ, (2) construction +18.8% QoQ, and (3) real estate +7.2% QoQ.
• TPB’s Q4 2023 CASA ratio improved by 5.4 ppts QoQ and 4.6 ppts YoY to 22.7%, higher than our expectations thanks to deposit rates achieving the lowest level over the last 20 years.
• 2023 NIM achieved 3.92% (-6 bps YoY) but Q4 2023 NIM alone was 4.92% (+115 bps QoQ) thanks to (1) higher exposure to high-yield segments, (2) control deposit growth being lower than credit growth, (3) significant improvement in CASA, and (4) improvement in NPLs formation.
• 2023 NFI including the gain from FX increased by 38.7% YoY mainly thanks to the 89.9% YoY increase in trading FX income while 2023 pure NFI decreased 10.0% YoY.
• 2023 provision expenses were recorded at VND3.9tn (+114.0% YoY) and Q4 2023 provision expenses increased by 1,619.7% YoY. In addition, the 2023 TPB write-off was VND3.0tn (1.47% of 2023 TPB’s loan book). This indicates the bank’s incentive to clean up its balance sheet and improve the provision buffer (LLR ratio was 63.7%, + 16.7 ppts QoQ), which is earlier than our expectation.
• Asset quality slightly improved on a QoQ basis while Q4 2023 NPL gross-up for write-off rate was 3.51% (-18 bps QoQ) and the other assets balance including accrued interests and receivables decreased 10.5% QoQ.
TPB’s consolidated 2023 results
VND bn | 2022 | 2023 | YoY | Q4 2022 | Q4 2023 | YoY |
NII | 11,387 | 12,425 | 9.1% | 2,780 | 3,996 | 43.8% |
Non-interest income | 4,231 | 3,809 | -10.0% | 884 | 447 | -49.4% |
OPEX | (5,945) | (6,699) | 12.7% | (1,646) | (1,843) | 12.0% |
PPOP | 9,672 | 9,535 | -1.4% | 2,017 | 2,600 | 28.9% |
Provision expenses | (1,844) | (3,946) | 114.0% | (115) | (1,970) | 1,619.7% |
NPAT-MI | 6,261 | 4,463 | -28.7% | 1,519 | 494 | -67.5% |
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Loan growth** | 14.0% | 27.5% | 13.5 ppts | 3.4% | 15.7% | 12.3 ppts |
Deposit growth** | 39.7% | 6.8% | -32.9 ppts | 23.1% | 7.4% | -15.7 ppts |
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NIM | 3.98% | 3.92% | -6 bps | 3.77% | 4.92% | 115 bps |
Interest-earning asset yield | 7.61% | 9.02% | 141 bps | 8.18% | 9.55% | 137 bps |
Cost of funds | 3.77% | 5.32% | 155 bps | 4.55% | 4.84% | 29 bps |
CASA ratio* | 18.0% | 22.7% | 4.7 ppts | 18.0% | 22.7% | 4.7 ppts |
CASA ratio plus term deposits in FX | 19.2% | 23.7% | 4.5 ppts | 19.2% | 23.7% | 4.5 ppts |
CIR | 38.1% | 41.3% | 3.2 ppts | 44.9% | 41.5% | -3.4 ppts |
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NPLs / Gross loans | 0.84% | 2.05% | 121 bps | 0.84% | 2.05% | 121 bps |
Group 2 loans / Gross loans | 1.92% | 2.81% | 89 bps | 1.92% | 2.81% | 89 bps |
Accrued interest / IEAs | 1.04% | 1.16% | 12 bps | 1.04% | 1.16% | 12 bps |
Source: TPB, Vietcap — *CASA volume includes demand deposits and margin deposits; ** Q4 2022 and Q4 2023 loan and deposit growth is QoQ growth; 2022 and 2023 loan and deposit growth is 12M growth.
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