Royal Bank of Canada's Profit Increases

By Allison Prang 

Royal Bank of Canada's profit increased in the third quarter as net interest income rose by almost 10%.

The bank, based in Toronto, reported net income of $3.26 billion Canadian dollars ($2.45 billion) in net income, up from roughly $3.1 billion the comparable quarter a year prior. Earnings were C$2.22 a share, up from C$2.10 a share. The bank said it had earnings of C$2.26 a share on an adjusted basis, up from C$2.14 a share.

The bank's credit-loss provision climbed 23% to C$425 million.

Net interest income, or the money that banks make from loans after taking out what they pay customers in interest, was C$5.05 billion, up 9.8%. Noninterest income, which comes from categories like insurance premiums and investment management, was C$6.5 billion, up 1%.

Total revenue, or net interest income and noninterest income combined, was C$11.54 billion. Analysts were expecting C$11.16 billion.

The Bank of Canada, the country's central bank, is expected to keep interest rates where they are, but it has faced more pressure to lower rates after the U.S. Federal Reserve recently cut interest rates by 25 basis points. Lower rates can hurt bank earnings by lowering what banks can make in interest on some loans.

Separately, the bank said Wednesday that at the end of January, its group head of RBC Capital Markets and RBC Investor & Treasury Services, Doug McGregor, is retiring. The bank said RBC Capital Markets' global head of investment banking, Derek Neldner, would take over as group head of capital markets in November.

(END) Dow Jones Newswires

August 21, 2019 07:08 ET (11:08 GMT)

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