RBC tops profit expectations on capital markets boost and lower provisions for sour loans
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- Royal Bank of Canada reported Q2 profit of $5.5 billion, a 25% increase, and adjusted earnings of $3.90 per share, beating analysts’ $3.77 forecast.
- RBC’s capital markets unit posted $1.48 billion in earnings, up 23% year‑over‑year, driven by higher global markets and corporate‑investment‑banking revenue.
- RBC lifted its quarterly dividend by $0.12 to $1.76 per share and announced a share‑repurchase plan for 45 million shares, about 3% of its common stock.
- RBC reduced its credit‑loss provisions to $912 million, down from $1.4 billion a year earlier, reflecting improved credit‑indicator stability.
- Derek Neldner, head of RBC’s capital markets, said elevated trading and M&A activity will persist amid heightened uncertainty, supporting near‑term earnings visibility.
Why it matters: Shareholders benefit from the higher dividend and share‑repurchase plan, while borrowers see tighter credit‑loss provisions indicating a healthier loan book; the stronger capital‑markets earnings boost RBC’s earnings outlook and competitive edge among Canadian banks.
