The Saudi Investment Bank (SAIB) reported a 33% Q-o-Q rise in 4Q16 net income to SAR302mn. Earnings were 9% below our estimates.   Main positives: i) Non-interest income growth (+11% Q-o-Q); ii) Decline in provisioning costs (est. cost of risk of 28bps)  Main negatives: i) Sharp decline in net interest spreads (-42bps Q-o-Q); ii) Decline in net loans (-1.7% Q-o-Q); iii) Decline in deposits (-1.2% Q-o-Q)   Our take on the results: Earnings recovered strongly, helped by the sharp decline in provisioning costs. SAIB had taken investment impairments of SAR165mn in the previous quarter, which is likely to have declined, or possibly reversed in 4Q16. The magnitude of decline in net interest spreads suggests that the bank had made some one-off adjustments, possibly de-recognising interest income on loans classified as NPLs. Non-interest income was strong, even though loan growth was sluggish. Management indicated in the results disclosures that non-interest income was boosted by higher fee, forex and investment gains. Balance sheet contracted Q-o-Q, with net loans declining 1.7% Q-o-Q, likely on repayments by corporates. Deposits also declined broadly in line with loans. (Company disclosure, Murad Ansari)   SAIB: SAR14.58 as of 19 January 2017, Rating: Neutral, FV: SAR14.50 per share, MCap: USD2,722mn, SIBC AB / 1030.SE