National Bank of Oman (NBO) reported 2Q16 net income of OMR15.5mn, 11% higher Q-o-Q, and 7% ahead of our forecast of OMR14.5mn.   Our take on the results: Revenues recovered, helped by acceleration in long growth, which -in our view- drove 13% Q-o-Q growth in non-interest income. Though net interest spreads weakened Q-o-Q, they were partially offset by strong loan growth and asset optimisation – LDR rose by c480bps to 114.5%. Provisioning costs were higher than expected, but eased from a high base in 1Q16. Overall, we believe the bank reported a strong set of results, with marginal contraction in spreads being the only negative. We see pressure on spreads and provisioning as key risk to earnings.   Main positives: i) Loan growth (+6.4% Q-o-Q); ii) non-interest income recovers (+13% Q-o-Q); iii) provisions estimated to be lower (-18% Q-o-Q)   Main negative: Weaker net interest spreads (-3bps Q-o-Q) (Earnings release, Murad Ansari)   National Bank Of Oman: OMR0.25 as of 14 July 2016, Rating: Neutral, FV: OMR0.26 per share, MCap: USD942mn, NBOB OM / NBO.OM