Canada's RBC faces shareholders as oil concerns cloud outlook
* Bank holds annual meeting in Montreal on Wednesday
* Oil price slump raises concerns about profitability
* RBC is major lender to oil firms, Alberta consumers
By Matt Scuffham
TORONTO, April 6 (Reuters) - Royal Bank of Canada, Canada's biggest lender, faces shareholders at its annual meeting in Montreal on Wednesday amid concerns over its oil and gas exposure following an increase in bad loans in the first quarter.
RBC is one of the biggest lenders to oil and gas firms in Canada and has a sizeable consumer loan book in the oil-producing province of Alberta, which has been hit by thousands of job losses.
The bank said in February that impaired loans to companies in the oil and gas sector had almost doubled from the previous quarter to C$310 million and it had set aside C$106 million to cover bad loans to the energy sector.
That warning, along with increased provisions by other lenders, raised concerns the impact on Canadian banks could worsen in the remainder of the year.
"The longer we go with these low oil prices the more pressure is going to come on the banks, so it's going to get worse. I think it's going to have some impact on earnings, especially for RBC, which has a big chunk of its business in capital markets," said Dan Werner, an analyst at Morningstar. Continued...