VIB (HOSE: VIB) | Initiation Report, BUY – FW2026 Upside +28.1%

Company Information

Vietnam International Commercial Joint Stock Bank (VIB) was founded in 1996 and has since steadily reinforced its leadership in retail banking and mortgage lending. Today, the bank serves around 5 million customers through 202 branches and transaction offices in 33 provinces and cities nationwide. VIB is also accelerating its digital transformation journey, aiming to build a comprehensive, technology-driven financial ecosystem.

Financial Performance

During the 2020–2024 period, VIB sustained steady growth, especially in retail banking segment, with retail loans accounting for roughly 80% of total credit. NPAT rose to an 11.6% CAGR to VND 7,204bn in 2024. NIM widened from 4.0% in 2020 to 5.0% in 2023 before easing to 3.7% in 2024 amid increased corporate lending and intensified funding-cost competition.

In 9M2025, VIB posted total operating income (TOI) of VND 14,725bn, down 3.7% YoY. Net interest income (NII) declined 7.4% YoY to VND 11,879bn, followed by the sector trend of compressing NIM. Non-interest income (non-NII) contributed a solid 19.3% of TOI, driven mainly by service fees and recoveries from previously written-off loans. As a result, VIB delivered 9M2025 PBT of VND 7,046bn, up 6.7% YoY, fulfilling 63.9% of the full-year target.

As of end-Q3 2025, total assets reached VND 543,560bn, up 10.2% YTD. Total credit rose 15.0% to VND 372,736bn, led by strong momentum in corporate lending (+52.4% YTD). Customer deposits grew to a stable 11.4% to VND 307,929bn. Notably, CASA jumped 21.8% YTD, reflecting effective liquidity-optimization efforts. Asset quality continued to improve, with the NPL ratio falling to 3.32% in Q3 2025 from 3.79% and 3.56% in the first two quarters.

Investment Rationales

o      Leading retail-focused bank with solid credit growth momentum: VIB maintains one of the highest retail loan proportions in the sector (roughly 80% of total loans) and continues to deliver strong credit growth, supported by its deep retail ecosystem and expected NIM improvement from 2026 as the bank optimizes its loan mix and funding structure.

o      Strategic diversification and digital transformation: VIB is broadening into high-quality corporate banking and strengthening its Private & Priority segment while advancing its “Mobile-first, Cloud-first, AI-first” strategy to drive digital lending, customer acquisition, and cost efficiency.

o      Strong income diversification: VIB leverages its strengths in cards and bancassurance, supported by its No.1 Mastercard spending position and partnerships with Prudential and MoMo, to expand recurring non-NII streams, with bancassurance income rising 53.5% YoY in 9M2025.

o      Improving asset quality: VIB’s NPL ratio has trended down to 3.32% as underwriting standards tighten and secured lending dominates the portfolio, while improving consumer sentiment and recoveries are expected to further support asset quality in late 2025.

o      Capital strength and cost efficiency: With consistently high ROE, strong cost control, and a Basel II CAR of 12.4%, VIB is well-positioned to sustain growth without near-term dilution risk.