RBC raises dividend as profit edges higher

Royal Bank of Canada on Friday reported a bigger-than-expected increase in quarterly earnings, driven by strong results from its wealth management and capital markets divisions. Canada's largest bank, as widely expected, also boosted its quarterly dividend by about 6 per cent to 75 Canadian cents a share. ‘We view this as an exceptionally strong quarter with very little to poke holes in, on our first cut,’ Barclays analyst John Aiken said in a note on Friday. ‘While we are decidedly positive on the results, naysayers will question the sustainability of the trading revenues and insurance earnings.’ Aiken, however, does not expect this to be an overhang on the stock, and he sees RBC shares reacting ‘quite favourably’ when trading begins on Friday. RBC reported net income of C$2.38 billion ($2.17 billion), or C$1.59 a share, for the third quarter ended July 31, compared with C$2.29 billion, or C$1.51 a share, a year earlier. The increase came despite a slight drop in profit from RBC's core personal and commercial banking business because of the sale of its operations in Jamaica, according to Reuters.