Royal Bank of Canada signage in Toronto's financial district.Andrew Lahodynskyj/The Canadian Press
Royal Bank of Canada RY-T reported higher first-quarter profit and topped analysts’ estimates, bolstered by a jump in earnings in personal banking and wealth management.
RBC profit climbed 13 per cent to $5.8-billion, or 4.03 per share, in the three months that ended Jan. 31. Adjusted to exclude certain items, the bank said it earned $4.08 per share, beating the $3.84 per share analysts expected, according to Refinitiv.
“RBC entered the 2026 fiscal year in a position of strength across our diversified business model and the core global markets where we operate,” RBC chief executive officer Dave McKay said in a statement. “We carried this momentum into our first quarter, reporting record results underpinned by strong earnings growth, our robust balance sheet and capital position, and a premium ROE that continues to deliver value for our shareholders.”
RBC is the fifth major Canadian bank to report earnings for the fiscal first quarter. National Bank of Canada NA-T, Bank of Montreal BMO-T and Bank of Nova Scotia BNS-T posted higher profit that beat expectations. Toronto-Dominion Bank TD-T and Canadian Imperial Bank of Commerce CM-T also report results on Thursday.
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In the quarter, RBC set aside $1.09-billion in provisions for credit losses – the funds banks set aside to cover loans that may default. That included $1.07-billion against loans that are still being repaid, based on models that use economic forecasting to predict future losses. In the same quarter last year, RBC reserved $1.05-billion in provisions.
Total revenue rose 7 per cent in the quarter to $17.96-billion and expenses increased 2 per cent to $9.46-billion, which the bank said was driven by higher compensation and other staff-related costs.
Profit from personal banking was $1.96-billion, up 17 per cent from a year earlier, boosted by higher net interest income.
Commercial banking earned $863-million, up 11 per cent, on higher deposits and loans and lower provisions on impaired debt.
The wealth management division generated $1.3-billion of profit, up 32 per cent on higher net interest income and lower provisions.
Capital markets profit rose 3 per cent to $1.48-billion, driven by higher trading and advisory revenue.