Topic: How To Invest

The Successful Investor Hotline – Friday, December 2, 2016

Article Excerpt

ROYAL BANK OF CANADA, $87.73, Toronto symbol RY, fell 2% this week after the bank reported lower-than-expected earnings. In the quarter ended October 31, 2016, the bank earned $2.5 billion. That’s down 1.9% from $2.6 billion a year earlier. Per-share earnings declined 5.2%, to $1.65 from $1.74, on more shares outstanding. That missed the consensus forecast of $1.72. Revenue jumped 15.5%, to $9.3 billion from $8.0 billion a year earlier. That’s mainly due to the bank’s recent purchase of Los Angeles-based City National for $5.5 billion U.S. This firm lends to both wealthy individuals and businesses in the entertainment, technology and health-care industries. Earnings from Royal’s retail banking business (which supplied 50% of the total) rose just 0.4%. Higher loan-loss provisions and increased spending on its online banking services offset stronger loan volumes in Canada and higher fee-based income. Profit from securities trading (19% of total earnings) fell 13.2%. That’s mainly because the year-earlier period benefited from a lower tax rate. The bank’s wealth management…