Royal Bank of Canada's ( NYSE: RY ) fiscal Q1 earnings beat the average analyst estimate, increasing from the prior and year-ago quarters, driven by strong results in its Personal & Commercial Banking and Wealth Management units and a rebound in Capital Markets. That was partly offset by lower results in its insurance business.
In addition, the bank known as RBC ( RY ) set more reserves aside for potential loan defaults as it took a dimmer view of the macroeconomic outlook and credit quality.
Q1 adjusted EPS of C$3.05 (US$2.25), topping the C$2.94 consensus estimate, rose from C$2.78 in the prior quarter and from C$2.87 in the year-ago period.
Net interest income for the quarter ended Jan. 31, 2023 slipped to C$6.20B (US$4.57B) from C$6.28B in Q4 2022 and increased from C$5.27B in Q1 2022. Net interest margin of 1.47% narrowed from 1.56% in the prior quarter and widened from 1.39% in the year-ago quarter.
RBC ( RY ) provision for credit losses of C$532M rose from C$381M in Q4 and from C$105M in Q1 2022.
Preprovision pretax earnings of C$5.9B increased 12% from the prior quarter and rose 7% from the year-ago period.
Personal & Commercial Banking preprovision pretax earnings were C$3.23B, up 4% Q/Q and 18% Y/Y; net income of C$2.06B increased 3% Q/Q and 7% Y/Y.
Wealth Management preprovision pretax earnings of C$1.15B increased 1% Q/Q and 7% Y/Y, while net income of C$848M rose 1% Q/Q and 3% Y/Y.
Insurance preprovision pretax earnings of C$190M tumbled 49% Q/Q and 25% Y/Y; net income of C$148M dropped 45% Q/Q and 25% Y/Y.
Capital Markets preprovision pretax earnings of C$1.42B surged 76% Q/Q and fell 3% Y/Y; net income of C$1.22B jumped 72% Q/Q and 9% Y/Y.
Conference call at 8:00 AM ET.
Earlier, Royal Bank of Canada ( RY ) non-GAAP EPS of C$3.05 beats by C$0.12, revenue of C$15.09B beats by C$1.56B.
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RBC fiscal Q1 earnings drive higher on P&C banking, wealth management