RBC’s Q3 earnings up 73%

Royal Bank of Canada reported net income of $2,240 million for the third quarter 2012, up $946 million (73%) from the prior year.

“RBC had a record quarter, driven by exceptional growth in our Canadian retail franchise and strong investment banking results,” says Gordon Nixon, RBC president and CEO.

Further comparing this quarter to 2011, the bank reported diluted EPS of $1.47 (up $0.64), return on common equity of 22.7% (up from 14.5%), and a tier 1 capital ratio of 13.0%.

The bank also reported a 5% increase in its quarterly dividend.

“RBC has strong momentum and continues to extend its leadership positions across key businesses by focusing on our clients and executing our disciplined, long-term strategy,” says Nixon.

Breaking it down by sector, Canadian banking net income was $1,127 million, up $239 million compared to last year. Wealth management net income was $156 million, down $36 million mainly due to lower transactions. Insurance net income was $179 million, up 27%. This is a result of lower claims costs in Canadian insurance products.

Meanwhile, RBC’s international banking sector reported a net loss of $31 million due to the acquisition of RBC Dexia.

“Our net loss this quarter, as compared to net income of $18 million last year, also reflected higher provision for credit losses in Caribbean banking, lower securities brokerage commissions in RBC Investor Services (rebranded from RBC Dexia) and higher staff costs,” says RBC.

Net income in capital markets was $486 million, up $227 million. Also, corporate support net income was $323 million, compared to $185 million a year ago.

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.