Net profit was down 27% Y-o-Y. UNB reported a net profit of AED447 million for 1Q16, +132% Q-o-Q and down 27% Y-o-Y. Earnings came in strongly ahead of our estimate of AED314 million and consensus of AED388 million.   Our view of the results:  A low-quality earnings beat. Earnings topped our expectation due to lower-than-expected provisioning, driven by release of provision reserves. Provision release from the corporate segment amounted to AED43 million in 1Q16 compared to AED28 million in 1Q15. The NPL ratio rose to 3.7% from 3.5% in 4Q15 and NPL coverage reduced to 103% from 108% in 4Q15. We expect provisioning to go up for the remainder of the year as provisioning is typically low for UNB in 1Q. For reference, in 2015 UNB took just 7% of their full-year provisions in the first quarter. Revenue declined 13% Y-o-Y in 1Q16, depicting the weakest trend amongst Abu Dhabi banks -  ADIB: +8% Y-o-Y, ADCB: -4% ; FGB:-5% and NBAD: -1%. Spreads contracted 24bps Q-o-Q to 2.30% as cost of funds continues to trend upwards. Loan growth was sluggish while fee income contracted sharply.   Main positive: Lower-than-expected provisioning (cost of risk 47bps versus our estimate of 190bps)   Main Negative: Sluggish loan growth (-0.1% Q-o-Q, +2.1% Y-o-Y); Contraction in spreads (-24bps Q-o-Q to 2.30%); Weak fee income (-6% Q-o-Q, -16% Y-o-Y) (Shabbir Malik, Company disclosure)