RBC reports net income of $1,563 million for the second quarter of 2012. The bank’s true net income was $1,765 million, up $83 million or 5% from last year, but the reporting number accounts for a $202 million after-tax loss from its acquisition of the remaining 50% of RBC Dexia.
The bank’s solid performance was driven by improved results in capital markets, and solid growth in insurance and wealth management.
Wealth management net income of $212 million was down $15 million against the prior year. Earnings climbed $11 million, driven by higher average fee-based client assets, but partially offset by lower transaction volumes. Net income was up $24 million.
“We’re . . . investing in our business to strengthen our global position,” says Gordon Nixon, RBC President and CEO. “Our agreement to acquire certain private banking assets from Coutts aligns with our strategy to increase market share in high net worth segments within key emerging markets.”
Canadian banking net income was $937 million, $42 million ahead of last year. Earnings rose $63 million and reflected strong 9% volume growth, driven by business and personal deposits, residential mortgages and business loans.
Against last quarter, net income was down $57 million and largely reflects fewer business days in the quarter and higher provisions for credit losses in the commercial lending portfolio.