Royal Bank of Canada (RYÂ -Â Snapshot Report) reported fiscal first-quarter 2015 (ended Jan 31) before the markets opened on Feb 25. Net income came in at C$2.5 billion ($2.1 billion), increasing 17% year over year.
Results benefited from top-line growth and decline in provisions. However, these were partially offset by a rise in non-interest expenses.
 Performance in Detail
Total revenue was C$9.6 billion ($8.3 billion), up 14% on a year-over-year basis. Revenue growth was driven by a rise in non-interest income as well as net interest income.
Net interest income came in at C$3.6 billion ($3.1 billion), up 4.9% from the prior-year quarter. Non-interest income was C$6 billion ($5.2 billion), rising 20.3% year over year.
Non-interest expenses were C$4.6 billion ($4 billion), up 5.3% from the year-ago quarter. The rise was primarily due to an increase in all the components, partially offset by a marginal fall in communications and other expenses.
During the quarter, all segments, except the Wealth Management, exhibited improved performance. Wealth Management segment recorded a 2.1% year-over-year fall in net income. However, net income in banking, insurance and capital market divisions were up 17.2% 17.8% and 17.6%, respectively. Further, Investor and treasury services recorded a 34% rise in net income while Corporate Support’s net income also rose significantly.
As of Jan 31, 2015, Royal Bank of Canada’s total average loans and acceptances stood at C$454.3 billion ($358.8 billion), up 7.3% from the prior-year quarter. Moreover, deposits were C$654.7 billion ($517 billion), up 10.1% year over year. Total assets were C$1.1 trillion ($858.2 billion), rising 17.2% from the prior-year period.
Total provision for credit losses was C$270 million ($213.2 million) in the quarter, down 7.5% year over year, mainly due to lower provisions in Canadian Banking and Wealth Management segments.
Capital Position
As of Jan 31, 2015, Royal Bank of Canada’s Tier 1 capital ratio came in at 11%, down 50 basis points (bps) from the prior-year quarter. Total capital ratio was 13.0%, down 50 bps year over year.
