We borrow a phrase from Bill Clinton’s campaign strategist to say “it’s the balance sheet, stupid”. As the last of the 3Q14 results trickled in a picture emerged that key balance sheet metrics across our coverage universe are indicating balance sheet stabilisation, though we are probably two quarters away from improvement (see Figure 19). Put simply VCB is now in a class of its own and we predict ACB will be the first to break away from the remaining banking pack.