Saudi British Bank (SABB) reported 1Q2016 net income of SAR1,142 million, 21% higher Q-o-Q. Earnings were ahead of our forecast of SAR939 million, and above Bloomberg consensus estimates of SAR1,028 million.   Main positives: i) Better net interest spreads (+10 bps Q-o-Q); ii) Strong non-interest income (+44% Q-o-Q); iii) Loan growth (+3.6% Q-o-Q)   Main negatives: Higher provisions (+24% Q-o-Q)   Our take on the results: A strong set of results, with balance sheet and revenue growth surprising positively. We estimate that net interest spreads jumped 10bps Q-o-Q, likely helped by asset re-pricing and better balance sheet liquidity management. Non-interest income recovered sharply from 4Q2015 lows, rising 44% Q-o-Q, which the management attributed to fee and forex income growth.  Though provisioning costs rose, they were more than offset by strong revenue growth. Loan growth was also stronger than expected; however, we expect a gradual slowdown over the next few quarters. (Earnings release, Murad Ansari)   Saudi British Bank: SAR21.60 as of 12 April 2016, Rating: Buy, FV: SAR33.00 per share, MCap: USD8,640 million, SABB AB / 1060.SE