Royal Bank of Canada posted a third-quarter loss on charges related to the sale of its U.S. retail bank, but earnings from continuing operations jumped 13%, reflecting solid volume growth against a backdrop of slowing economic growth.
Net loss for the quarter ended July 31 was C$92 million, or 11 Canadian cents a share, compared to year-earlier net income of C$1.28 billion, or 84 Canadian cents, primarily reflecting a C$1.66 billion loss from its discontinued operations in the U.S., the Toronto-based bank said.
Net income from continuing operations rose to C$1.57 billion, or C$1.04 a share, from C$1.38 billion, or 92 Canadian cents a year earlier. Cash earnings per share were C$1.06, falling just shy of the C$1.08 mean estimate from analysts polled by Thomson Reuters.
Royal Bank took a previously announced C$1.3 billion writedown of goodwill and intangibles from its planned US$3.45 billion sale of its struggling U.S. retail bank to PNC Financial Services Group Inc. The deal isn't expected to close until March.
Total revenue from continuing operations rose 2% to C$6.79 billion.
Provision for credit losses fell slightly to C$275 million from C$277 million.
Canadian banking net income rose 12% to C$855 million from volume growth and lower credit-loss provisions.
Wealth-management earnings fell 3% to C$179 million. Excluding certain accounting and tax adjustments in the year-earlier period, net income rose 22%, mostly from higher average fee-based client assets.
Capital markets net income surged 38% to C$277 million. But, excluding certain market and credit-related items, it rose just 6%, as strong fee-based growth from corporate and investment banking activity was mostly offset by lower fixed-income trading results.
