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Royal Bank of Canada (NYSE:RY), also known as RBC, turned in robust fiscal Q3 results, buoyed by year-over-year growth in Personal & Commercial Banking, Capital Markets, and Wealth Management, partly offset by lower results in Insurance and Corporate Support.
The bank said it remains on track to achieve targeted cost synergies of C$740M from its acquisition of HSBC Canada, with $120M achieved year-to-date, about half of the annualized target.
Fiscal Q3 adjusted EPS of C$3.26 (US$2.42), easily topping the Visible Alpha consensus of C$2.92, rose from C$2.92 in the previous quarter and C$2.83 in the year-ago period.
Total revenue of C$14.6B (US$10.9B) for the quarter ended July 31, 2024, increased from C$14.2B in Q2 and C$13.0B in Q3 2023.
RBC (RY) stock rose 1.1% in Wednesday premarket trading.
Q3 net interest income of C$7.33B climbed from C$6.62B in the prior quarter and C$6.29B a year ago.
Noninterest income of C$7.30B fell from $7.53B in the previous quarter and increased from C$6.69B a year ago.
Preprovision pretax earnings of C$6.0B rose 3% Q/Q and 16% Y/Y. Excluding HSBC Canada results, preprovision pretax earnings increased 8% from last year, mainly on higher net interest income reflecting higher spreads and solid average volume growth in Canadian Banking.
RBC’s (RY) provision for credit losses slid to C$659M from C$920M in the previous quarter and increased from C$616M a year ago.
RBC’s (RY) adjusted return on equity improved to 16.4% from 15.5% in Q2 and 15.4% in Q3 2023.
Average net loans and acceptances increased to C$968.5M from C$908.0M in Q2. Deposits of C$1.36T climbed from C$1.33T in Q2.
Results, by segment:
- Personal & Commercial Banking net income of C$2.49B, up 21% Q/Q and 16% Y/Y; revenue of C$6.45B climbed 13% Q/Q and 22% Y/Y.
- Wealth Management adjusted net income of C$918M increased 11% Q/Q and 28% Y/Y; revenue of C$4.77B rose 3% Q/Q and 8% Y/Y.
- Capital Markets net income of C$1.17B dipped 7% Q/Q and grew 23% Y/Y; revenue of C$3.00B fell 5% Q/Q and gained 12% Y/Y.
- Insurance net income of C$170M dropped 4% Q/Q and 21% Y/Y, while revenue of C$285M declined 4% Q/Q and 15% Y/Y.
Conference call at 8:00 AM ET.
Earlier, Royal Bank of Canada Non-GAAP EPS of C$3.26, revenue of C$14.63B
