Royal Bank sees strong third quarter profit growth

RBC’s net income in its third quarter was up 17% from a year ago.

Royal Bank of Canada had $2.895 billion of net income in its third quarter, up 17 per cent from a year ago in part because of the sale of an insurance business.

The bank (TSX:RY) had a profit of $2.475 billion during the same quarter last year.

The earnings amounted to $1.88 per share, up from $1.66 during the same quarter in 2015.

Excluding an after-tax gain of $235 million from the sale of RBC General Insurance, RBC's net income would have been $2.66 billion, or $1.72 per share, up seven per cent from a year ago.

RBC had total revenue of $10.26 billion during the quarter ended July 31, compared with $8.83 billion during the same period last year.

The bank also announced it's raising its quarterly dividend by two cents to 83 cents per share.
Meanwhile, provisions for credit losses the money set aside for bad loans decreased by $142 million, or 31 per cent, to $318 million.

Barclays analyst John Aiken said the decline in loan loss provisions was mostly related to the energy sector.

"RY's results were solid, with the only weakness coming from its insurance operations and the beat was largely generated by much better than anticipated provisions for credit losses,'' Aiken said in a note to clients.

"As anticipated, RY saw a material decline in energy related provisions, although it did still take some against much more mod

The Canadian Press