Royal Bank of Canada (NYSE:RY) Q2 2017 Earnings Conference Call - Preliminary Transcript

May 25, 2017 • 07:30 am ET

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Royal Bank of Canada (NYSE:RY) Q2 2017 Earnings Conference Call - Preliminary Transcript

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Presentation
Operator
Operator

Good morning ladies and gentleman welcome to the RBC 2017 Second Quarter Results Conference Call. I would now like to turn the meeting over to Mr. Dave Mun, SVP and Head of Investor Relations. Please go ahead, Mr. Mun.

Executive
Dave Mun

Thank you, operator and thanks, everyone, for joining us this early in the morning. Speaking today will be Dave McKay, President and Chief Executive Officer; Rod Bolger, Chief Financial Officer; and Mark Hughes, Chief Risk Officer. Following their comments, we'll open the call for questions. [Operator Instructions] Joining us in the room are Jennifer Tory, who just started her role as Chief Administrative Officer this month but will answer your questions on Personal & Commercial Banking's second quarter results; Neil McLaughlin, our new Group Head, Personal & Commercial Banking; Doug Guzman, Group Head, Wealth Management & Insurance; and Doug McGregor, Group Head, Capital Markets and Investor & Treasury Services. As noted on Slide 2, our comments may contain forward-looking statements which involve applying assumptions and have inherent risks and uncertainties. Actual results could differ materially from these statements. With that, I'll turn it over to Dave.

Executive
David McKay

Good morning, everyone and thanks for joining us today. This morning, we reported earnings of $2.8 billion, up 9% from last year. And diluted EPS was up 11%. We have strong results across our core businesses. Canadian Banking had a good quarter with solid volume trends, particularly in business loans and deposits as well as cards. We demonstrated cost discipline even as we invested more in technology. I'm also proud that we were recently named Global Retail Bank of the Year for the third time by Retail Banker International. The impact of our long term focus on client relationships and favorable markets were factors driving double-digit growth in Capital Markets, Wealth Management and Investor & Treasury Services this quarter. In Capital Markets, we achieved market share gains in the U.S. and our investment banking fees also benefited from strong corporate activity. This helped us break through the top 10 globally, ranking ninth by investment banking fees, according to Thomson Reuters. In Wealth Management, our results were driven by strong performance in both Canada and the U.S.

In Canada, our clients continue to choose RBC more than any other institution with their investments. And in the U.S, we had another great quarter, with double-digit growth in both loans and deposits at City National. Investor & Treasury Services continue to show strong earnings growth and cost control while investing heavily in technology for our clients. Our Insurance business had a stable quarter, although earnings were down due to the impact of the sale of our home and auto business sorry, insurance manufacturing business and last year's tax recovery. On credit, all of our credit trends were relatively stable and we remain well capitalized with a CET1 ratio of 10.6%. Our strong capital position enabled us to buy back over 29 million common shares in the second quarter. And since of the closing of City National, we have bought