Net profit up 0.6% Q-o-Q, in-line with estimate. NBAD reported net profit of AED1,329mn for 4Q16, +0.6% Q-o-Q and +28.3% Y-o-Y, and broadly in line with our estimate of AED1,280mn (Bloomberg consensus AED1,308mn). Mgmt. proposed a cash dividend of AED0.45/share (in line with our estimate of AED0.45/share).   Our view of the results: The results were mixed. Earnings came in line with expectation as good cost control and strong investment income compensated for weaker-than-expected fees (weak loan growth) and FX income (EGP and GBP devaluation). Provisioning remained under control with cost of risk at 59bps, as the NPL ratio improved slightly to 2.70% from 2.73% in 3Q16. Spreads were stable Q-o-Q as cost of funds eased sequentially. Loan book contracted 2.3% Q-o-Q likely due to devaluation of EGP and GBP and unwinding of low-yielding trade loans. Deposit growth was strong at 4% Q-o-Q, and this helped improve the bank’s liquidity further – LDR declined to 79% from 85%.   Main Positives: i) Good cost discipline (Operating costs -4% Y-o-Y); ii) Strong deposit growth (+4% Q-o-Q); iii) Provisioning remains under control (cost of risk 59bps)   Main Negatives: i) Decline in the loan book (-2.3% Q-o-Q, -2.6% Y-o-Y); ii) Weak fee income (-5% Q-o-Q and -10% Y-o-Y); iii) Weak FX income (-58% Q-o-Q) (Shabbir Malik, company)   NBAD: AED10.40 as of 30 Jan, Rating: Buy, TP: AED10.80 per share, MCap: USD14,763 mn, NBAD UH / NBAD.AD