Royal Bank of Canada (TSX:RY) has beaten analysts’ estimates for its quarterly profit driven by strength in its capital markets and wealth management divisions.
Canada’s largest lender also benefitted from the release of some of the reserves it set aside to cover loan losses during the most recent quarter.
Royal Bank reported net income of $4 billion or $2.76 a share, up 170% from $1.48 billion or $1 per share a year ago. Analysts had expected a profit of $2.48 a share, according to Refinitiv data.
The bank also released provisions on performing loans of $260 million, compared with elevated provisions of $2.1 billion in the same period of 2020.
Royal Bank saw profit growth in all of its major divisions, most notably in its core personal and commercial operations where net income nearly quadrupled year-over-year to $1.9 billion as provisions shrank and loan activity rose.
The bank's capital markets unit also stood out in the quarter, with net income reaching $1.1 billion compared to $105 million a year earlier when loan-loss provisions weighed on the unit. Royal Bank said that the division benefitted from record revenue from its investment banking operations this year.
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