March 1, 2012 / 11:33 AM / in 6 years

RBC raises dividend as profit tops estimates

(Reuters) - Royal Bank of Canada’s quarterly earnings fell 6 percent due to weaker capital markets revenue, but the result topped analysts’ estimates and the bank unexpectedly raised its quarterly dividend.

A Royal Bank of Canada (RBC) logo is seen at a branch in Toronto November 9, 2007. REUTERS/Mark Blinch

RBC, Canada’s largest bank, said net income from continuing operations was C$1.88 billion ($1.91 billion), or C$1.23 a share, in the first quarter ended January 31. The bank no longer recognizes results from its U.S. retail bank, which it agreed to sell last year.

That compared with a year-earlier profit of C$2.00 billion, or C$1.31 a share.

Excluding special items, earnings were C$1.25 a share, topping analysts’ estimates of a profit of C$1.13, according to Thomson Reuters I/B/E/S.

The bank raised its quarterly dividend by 3 Canadian cents to 57 Canadian cents per share.

Canadian banking income rose 7 percent, helped by higher lending volumes and credit quality and offset by narrower interest margins. The unit, the bank’s biggest, earned a record C$994 million during the quarter.

The bank’s insurance business rose 40 percent to C$190 million.

Offsetting this was a 30 percent drop in capital markets income to C$448 million, as trading results weakened following an abnormally strong period in early 2011.

Wealth management income also decreased, by 12 percent to C$188 million, due to lower volumes and higher costs.

($1 = 0.9850 Canadian dollars)

Reporting By Cameron French in Toronto; Editing by Lisa Von Ahn

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