RBC Sees Strong Earnings Momentum, AI as Key Growth Driver
The Royal Bank of Canada (RBC) presented its financials at Scotiabank's 27th Annual Financials Summit, highlighting strong earnings momentum and rising efficiency. The bank's return on equity topped 18% in the latest quarter, up from 16.5% in 2025 and 15.5% in 2024.
RBC CEO Dave McKay emphasized that the bank is focused on organic growth and artificial intelligence (AI), rather than a large takeover. The bank expects CAD 1 billion in AI-related cost benefits after implementation costs.
The bank's common equity tier 1 ratio remained at 13.5%, and its capital generation has been steady. RBC pointed to more than CAD 80 billion in lending growth, strong deposit gains, and a growing contribution from City National, its U.S. unit.
McKay said that the bank's AI project is its main strategic priority, with a focus on improving employee efficiency and raising returns faster than revenue alone could do. He also noted that RBC's model gives it room to keep winning business without sacrificing returns, due to its deposit base lowering funding costs.