Kuwait Finance House has reported 3Q16 net income of KWD52.2mn, up by 20% Y-o-Y and by 42% Q-o-Q, coming in well ahead of EFG Hermes estimate of KWD33.8mn. We believe that the most likely driver of the earnings beat was a one-off capital gain from the sale of KFH’s 53% stake in Aref Investment Group (a Kuwait Islamic investment company), which was probably booked in 3Q16. According to the press release issued by KFH, loans were flat Q-o-Q (up 6% Y-o-Y), while deposits fell 3% Q-o-Q (flat Y-o-Y). We await for the financial statements to give more color on the results. (Elena Sanchez-Cabezudo, CFA, Company)