TORONTO - The Royal Bank (TSX:RY) says it earned a record $2.24 billion in the quarter ended July 31, a gain of $946 million or 73 per cent from the same period last year.
Diluted earnings per share were $1.47 in the quarter, up from 83 cents.
Excluding certain items, net income from continuing operations was $1.978 billion, up 18 per cent from last year due mainly to record earnings in Canadian banking and strong performance in capital markets.
Canadian banking net income was a record $1.127 billion, up $239 million compared to last year.
Analysts had expected earnings per share of $1.18 on revenue of nearly $7.22 billion, according to Thomson Reuters.
RBC also announced a five per cent increase in its quarterly dividend. The bank had already boosted its dividend this year — by six per cent in the first quarter.
In the second quarter, Royal Bank of Canada completed an acquisition that negatively affected profits. The bank said the acquisition of the remaining half of advisory firm RBC Dexia left a $202-million dent in earnings.
In March, Moody's debt rating agency placed Royal Bank under review for a possible downgrade, but did not put the bank's covered bond ratings on review.
The Royal Bank has said it does not believe it deserves to be among a group of the world's largest banks whose credit ratings have been placed under review by Moody's because of their exposure to the global capital markets business.
Royal Bank is the country's largest bank by assets and market capitalization and has 77,000 employees serving more than 18 million clients. The bank has operations across North America and in 52 other countries.
It operates under the RBC Bank banner in the U.S., with more than 400 branches throughout North Carolina, South Carolina, Virginia, Georgia, Florida and Alabama.
The banks were formerly part of the Centura and other brands that were acquired by Royal starting a decade ago.
However, the Canadian bank's rapid expansion struck a major hurdle when the U.S. housing bubble burst and hit mortgage markets hard in southern U.S. states where the former Centura bank operated.