We cut our target price (TP) for VCB by 7.4% to VND103,300/share but maintain a BUY rating.

Our lower TP results from a 0.4% decrease in our projection for aggregate 2022-2026F NPAT-MI and an increase in our house cost of equity from 12.5% to 13.0%, which are partly offset by an increase in our target P/B from 3.37x to 3.46x due to moving our assumption for the bank’s planned private placement to 2023.

We lower our 2022F NPAT-MI forecast by 5.3% to VND29.2tn (+33.1% YoY) as a result of (1) a 9.0% decrease in NFI (including FX trading) and (2) 26.0% increase in provision expenses, which are partly offset by a 1.4% increase in NII following a 1 ppt increase in our loan growth assumption to 18%.