Royal Bank of Canada (TSX:RY) reported better-than-expected profit and revenue in the financial third quarter, despite increased provisions for bad debts, with growth in all core businesses.
For the three months ended July 31, the Canadian lender saw net income total C$3.9 billion or C$2.73 a share, compared with C$3.58 billion, or C$2.51 a share the year prior.
On an adjusted basis, earnings rose over 11% to C$2.84 a share, ahead of the C$2.72 consensus, according to FactSet.
Total revenue climbed 19% to C$14.49 billion from C$12.13 billion, ahead of analyst forecasts of C$12.82 billion, while return on equity remained unchanged at 14.6%.
RBC reported growth across all its core businesses, particularly its capital markets division which posted a 57% increase in net income to C$938 million, boosted by higher revenue in corporate and investment banking.
Personal and commercial banking, its largest division, saw a 5% increase in net income to C$2.13 billion, primarily due to higher net interest income and increased deposits and loans.
Provision for credit losses neary doubled to C$616 million, up from C$340 million, while the bank's Tier 1 ratio rose 100 basis points to 14.1%.