* Adj EPS C$1.25/shr vs EST C$1.13
* Retail banking stronger, wholesale weaker
* Dividend rises 5.6 pct
March 1 (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.
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 Jan. 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.