May 27, 2010 / 10:35 AM / 7 years ago

UPDATE 1-RBC posts lower-than-expected quarterly profit

* Q2 EPS C$0.88 vs loss C$0.07 yr-ago

* Q2 core cash EPS C$0.96, below expectations

* Canadian dollar strength cut revenues, income

TORONTO, May 27 (Reuters) - Royal Bank of Canada (RY.TO) reported a lower-than-expected quarterly profit on Thursday as the strong Canadian dollar ate into revenue and loan losses edged up from the previous quarter.

Canada's largest bank said net income was C$1.33 billion ($1.27 billion), or 88 Canadian cents a share, in the second quarter ended April 30.

That compares with a year-earlier net loss of C$50 million, or 7 Canadian cents a share, that included a C$1 billion goodwill impairment charge for losses in the bank's U.S. operations. Without that charge, net income would have been up 40 percent.

RBC said core cash earnings per share, which include the amortization of intangibles, were 96 Canadian cents a share.

Analysts on average were expected a per-share profit of C$1.09, according to Thomson Reuters I/B/E/S.

Toronto-based Royal Bank said the strengthening of the Canadian dollar had cut revenue by C$534 million, net income by C$82 million and per-share earnings by 6 Canadian cents.

The bank said provisions for credit losses, or the amount of money set aside to cover bad loans, fell 48 percent to C$504 million from a year earlier but rose C$11 million, or 2 percent, from last quarter.

Tier 1 capital was 13.4 percent, at the high end of domestic peers and well above that of most global rivals. (Reporting by Andrea Hopkins; Editing by Lisa Von Ahn)

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