RBC Smashes Q3 Profit Expectations with 11% Boost

Royal Bank of Canada (RBC) has reported higher third-quarter profit that exceeded analysts' estimates. The bank's profit rose 11 per cent to $6-billion, or $4.23 per share, in the three months ending July 31. Excluding certain items such as HSBC Canada transaction and integration costs, RBC earned $4.28 per share, topping the $4.07 per share analysts expected.

RBC's chief executive officer Dave McKay stated that the bank's strong performance demonstrates its diversified business model and robust balance sheet. The lender aims to boost its profitability and has set a return on equity (ROE) target of 17 per cent or more, up from the previous goal of 16 per cent.

In the quarter, RBC posted adjusted ROE of 18.1 per cent, exceeding its own target. The bank also set aside $1-billion in provisions for credit losses, which was lower than analysts anticipated. Total revenue rose 9 per cent to $18.54-billion, while expenses increased 6 per cent to $9.79-billion.