Business

Royal Bank profit rises 43%

The Royal Bank says record earnings in Canadian banking and its insurance arm drove net income 43 per cent higher in the fourth quarter to $1.6 billion.

The Royal Bank says record earnings in Canadian banking and its insurance arm drove net income 43 per cent higher in the fourth quarter to $1.6 billion.

For the year, the country's largest bank earned a record $6.7 billion — up $918 million or 16 per cent from the prior year.

The bank says earnings per share in the quarter were $1.07, up from 74 cents in the same quarter last year.

Analysts had expected earnings per share of 98 cents on revenue of $6.86 billion.

"RBC delivered strong earnings from continuing operations of over $1.6 billion in the fourth quarter and a record $6.7 billion this year," said RBC president and CEO Gord Nixon.

He says the growth was driven primarily by record earnings in Canadian banking, wealth management and insurance and strong results in corporate and investment banking.

"This performance demonstrates the strength of our businesses and the quality of our earnings."

In October, Luxembourg Finance Minister Luc Frieden told a news conference that Canada's biggest bank was in talks to acquire the remaining stake of its joint venture with Dexia.

While Frieden said that the discussions were in a "very advanced stage" a Royal Bank representative declined to comment and an agreement has yet to materialize.

The company is equally owned by Royal Bank and Dexia and provides institutional investors a range of products and services — from fund and pension administration to securities lending and shareholder services.

Royal Bank operates under the RBC Bank banner in the U.S., with more than 400 branches throughout North Carolina, South Carolina, Virginia, Georgia, Florida and Alabama.

The banks were formerly part of the Centura and other brands that were acquired by Royal starting a decade ago. However, the Canadian bank's rapid expansion struck a major hurdle when the U.S. housing bubble burst and hit mortgage markets hard in southern U.S. states where the former Centura bank operated.

Royal Bank is the country's largest bank by assets and market capitalization, and has 77,000 employees serving more than 18 million clients. The bank has operations across North America and 52 other countries.