Find out how the banking giant fared in the third quarter
Royal Bank of Canada (RBC) kicked off earnings season this morning by announcing its third-quarter results, with the banking giant seeing its net income jump 8% from the prior year.
The bank said its reported net income for Q3 totalled $3.9 billion, a year-over-year increase of $295 million, with diluted earnings per share increasing by 9% to $2.73. The bank’s pre-provision, pre-tax earnings came in at $5.2 billion, up from the same time last year mainly thanks to higher capital markets revenue.
That growth on the capital markets side was bolstered by strong performance in corporate and investment banking, RBC said, while higher interest rates and strong volume growth in Canadian banking also spurred the strong overall performance.
Higher salaries and stock-based compensation weighed slightly against those factors, while other expenses included ongoing technology investments and higher discretionary costs.
Net income for RBC’s wealth management division fell by 18% from a year ago to $674 million, while the bank revealed a CET1 ratio of 14.1%, up 40 basis points quarterly.
RBC said it expected to trim its workforce further in the coming quarter, with its number of full-time equivalent employees having fallen by 1% compared with Q2.
Its results reflected higher provisions for credit losses, the bank indicated, with its PCL on loans ratio coming in at 29 basis points. Meanwhile, lower taxes also helped achieve a “favourable shift in earnings mix.”
