VCB – Save for a rainy day – Earnings Flash

• 1Q20 net profit fell 11.2% yoy on surging provision expenses. VCB ramped up its provision buffer in light of possible hike in bad debts.
• 1Q20 net profit came in at 19.7% of our full-year forecast. We keep our FY20 forecasts as we see stronger quarters ahead.
• Maintain Add as VCB is trading below its 5-year average P/BV while having the best recovery outlook among stocks under our coverage

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