Vietcombank’s management has set a cautious profit growth target of 5-10% for 2026, but SSI Research said the bank has a long track record of beating guidance and could see earnings growth accelerate after averaging just around 3% over the past two years.

The bank posted profit attributable to parent shareholders of nearly VND35.18 trillion ($1.35 billion) in 2025, up 4% from a year earlier.

SSI Research said earnings growth in 2024-2025 was weighed down by a sharp contraction in net interest margin (NIM) and a slowdown in fee income.

In 2025, Vietcombank cut lending rates aggressively to support economic growth, compressing NIM by 23 basis points year-on-year, while fee income fell 32%. Margins began to stabilize toward the end of the year, with NIM rising 14 basis points quarter-on-quarter in Q4/2025.

The research unit expects margins to remain under pressure in H1/2026 amid intense competition for deposits and efforts to keep the net loan-to-deposit ratio below 100%, before recovering more clearly in H2.

Credit growth in 2026 is expected to be driven mainly by corporate lending, particularly to national infrastructure projects, which could lift the share of medium- and long-term loans and support asset yields.

With the ratio of short-term funds used for medium- and long-term lending at 23%, Vietcombank still has room to optimize its funding structure and expand NIM over the medium term, SSI Research said.

Fee income remains a weak spot in the bank’s earnings mix. Net fee income fell 6% quarter-on-quarter in Q4/2025 and dropped 32% for the full year. Excluding bancassurance fees booked in 2024, fee income was largely flat, reflecting limited growth in service-related businesses.

SSI Research said Vietcombank’s profit growth likely bottomed out in 2025 and could normalize in 2026, forecasting a 15.6% rise in pre-tax profit.

Key drivers include credit growth of 14% and a modest 6-basis-point improvement in NIM to 2.69%; a 13% increase in fee income supported by strengths in trade finance, foreign direct investment-related services, and foreign exchange transactions; a stable cost-to-income ratio of around 34% as the bank continues to invest in technology; and provisioning costs of about VND4 trillion ($153.58 million), with no major pressure on asset quality.

At a recent meeting with investors, Vietcombank’s management reiterated its conservative stance, prioritizing a balance between growth and asset quality.

SSI Research said this approach is consistent with the bank’s long-standing strategy, but noted that its history of outperforming targets suggests 2026 could mark a return to double-digit earnings growth.

A clearer recovery in NIM could lead to a positive re-rating of the stock, the analysts said, adding that potential catalysts include a stock market status upgrade by FTSE Russell (from frontier to secondary emerging) and progress on a planned private placement of 6.5% of the bank’s charter capital.

Successful capital raising would strengthen Vietcombank’s capital buffer and support medium-term growth. The research unit set a new 12-month target price of VND84,900 ($3.23) per share, based on a target price-to-book ratio of 2.7 times, compared with a closing price of around VND64,900 last Friday, February 27.

VCB shares closed Friday at VND64,900 ($2.49) apiece.