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RBC’s fiscal 2Q earnings beat Street helped by growth in wealth management and retail businesses

The performance of the Canadian bank’s investment banking division was more muted

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RBC’s wealth management business lifted net income by 25%

Shares of Royal Bank of Canada (NYSE:RY) were little changed Thursday after Canada’s biggest lender by market value posted fiscal second quarter earnings that handily beat analyst expectations.

RBC was down 0.59% to US$78.86 in pre-market trade in the New York Stock Exchange.

For the quarter ended March 31, the bank booked earnings of C$2.06 helped by strong growth at its wealth management and retail businesses. Excluding one-off items, earnings per share rose to C$2.10. The consensus earnings estimate was C$2.05.

Net income increased by 9% compared with the previous year to C$3.1bn. That included net income of C$1.46bn at its personal & commercial banking business, up 7% reflecting improved margins and sales.

The bank’s wealth management business lifted net income by 25% to C$537mln. Reuters attributed the high-octane growth to benefits from tax reform in the United States.

However, the performance of RBC’s investment banking division was more muted, with net income totaling C$665mln, roughly unchanged on a year ago amid less favorable market conditions.

Quick facts: Royal Bank of Canada

Price: 94.59 CAD

TSX:RY
Market: TSX
Market Cap: $134.61 billion
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