Company Insight

- TCB reported a remarkable 17.4% year-to-date (YTD) credit growth in 9M/2024, surpassing the industry average of 9%.

- Amidst the pressure to lower asset yields to stimulate credit growth, TCB's Net Interest Margin (NIM) slightly declined to around 4.37%. Net interest income in Q3/2024 increased 22.8% YoY but slightly decreased by 5.8% QoQ. NPL  ratio remained stable at 1.3% at the end of Q3/2024. Fee income continued to headwind in Q3/2024. Declining demand for UPAS/LC and a shrinking Bancassurance business were the primary factors contributing to a 7% YoY decrease in TCB's fee income in Q3/2024. During this period, TCB also announced the termination of its exclusive insurance distribution agreement with Manulife, resulting in a compensation cost of approximately VND 1,800 billion. Additionally, in October 2024, TCB participated in the establishment of Techcom Non-Life Insurance Company (TCGIns).

- TCB's profit before tax (PBT) in Q3/2024 reached VND 7,214 billion (+23.5% YoY), slowing down compared to the first two quarters but still exceeding 84% of its 2024 profit target.

- Key assumptions for 2024 include Consolidated credit growth of over 22%, NIM recovering to 4.38%, NPL controlled at around 1.3%, Credit risk cost/total credit below 1.0%, CIR 31%. TCB's pre-tax profit in 2024 is forecast to reach VND 26,940 billion (+17.7% YoY), revised down from the latest report due to costs arising from the termination of exclusive distribution of Manulife. In 2025, we expect TCB's credit growth to reach around 18%, NIM stable at 4-4.5%, NPL ratio around 1-1.5%, CIR ratio falling below 30% thanks to technological advantages, we forecast PBT in 2025 to reach VND 34,734 billion (+28.9% YoY).