Royal Bank of Canada's F3Q Beat Skewed Toward Capital Markets
Dow Jones
Aug 27
1008 ET - Royal Bank of Canada delivered a strong F3Q beat, but TD Cowen's Mario Mendonca says the core everyday banking side was softer than expected. The analyst notes adjusted cash EPS was up 11% C$4.28, topping his expectations of C$4.08 and consensus of C$4.10. "RY beat estimates on better performance in cap markets and wealth management," the analyst says, which has been a trend this quarter among Royal Bank's peers, noting that "we view beat as over-indexed to market related business." By contrast, Canadian retail and commercial banking missed expectations, as net interest margin in Canadian banking shrank slightly due to heightened competition and lower lending spreads.
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