Jump in provisioning costs (est. at 90bps for 3Q16 vs. 28bps in 2Q16) Weaker net interest spreads (-7bps Q-o-Q) Weak non-interest income (-20% Q-o-Q) Decline in deposits (-2% Q-o-Q) Decline in loans (-1% Q-o-Q)   Riyad Bank reported 3Q16 net income of SAR729mn, 36% lower Q-o-Q and 33% below our estimates, driven mainly by a jump in provisioning costs.   Our take on the results: A fairly weak set of results, with 3Q16 earnings being the lowest since 3Q10. Spreads, which had bounced strongly in the previous quarter, came under pressure again on rising funding costs and slower asset book re-pricing. Non-interest income was weak, as expected (20% lower Q-o-Q) due to seasonality (Eid and summer holidays). The big surprise was provisioning, which -though was expected to rise to from a low base in the previous two quarters- jumped sharply. We estimate annualised cost of risk at 90bps for 3Q16 compared to 28bps in 2Q16. Loan and deposit book contracted after steady expansion in the previous two quarters. (Earnings release, Murad Ansari)   Riyad Bank: SAR9.32 as of 10 October 2016, Rating: Neutral, FV: SAR12.50 per share, MCap: USD7,456mn, RIBL AB / 1010.SE