RBC’s net income plummet by 17% in Q3 2022
RBC’s Q3 profits slip
Fergal McAlinden
other
The banking giant’s third-quarter results were down from last year and came in lower than analysts expected
Royal Bank of Canada (RBC) saw its year-over-year net income in 2022’s third quarter plummet by 17% to $3.58 billion, with adjusted earnings of $2.55 per share falling well short of average analyst expectations of $2.67.
That result arrived as the banking giant put away $340 million in provisions for credit losses, mostly in its Canadian banking division, with “unfavourable changes in our macroeconomic environment” largely behind that move, RBC said.
The company registered a 4% dip in personal and commercial banking operations profits compared with the same time last year, with those coming in at $2.02 billion, while income from its capital markets business slumped 58% year over year to $479 million.
That capital markets drop was attributed mostly to markdowns on loan underwriting in the US totalling $385 million, while RBC’s corporate and investment banking revenue also fell, to $625 million.
Mortgages, credit cards, and business lending all helped spur a 10% jump in RBC’s average loan volumes despite the lower yearly profits on the personal and commercial banking side.
The bank’s chief executive, Dave McKay, indicated in a press release that despite an “uncertain world,” it continued to “operate from a position of strategic and financial strength” moving forward.
“Our balance sheet is strong, and our talented team is as focused as ever on delivering the innovative products, insightful advice and leading partnerships that our clients count on,” he said.
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