Royal Bank of Canada

Record profitability & strong momentum (what’s good) - $6.0B record earnings, +11% YoY; revenues +9% YoY. - Adjusted operating leverage +2.4% and adjusted efficiency ratio 52% (improved cost efficiency). - ROE ~18% (nearly) and book value per share +10% YoY; 80 bps of internal capital generation this quarter (3 pp over 12 months).

Capital strength remains solid; shareholder returns continued (dividends/buybacks) - CET1 flat at 13.5% (robust 13.5% common equity capital). - Capital deployed: 85 bps in the quarter to grow business, pay dividends, and buy back shares. - Share repurchases: 5.6M shares for ~$1.6B. - Total payout ratio 69% (rising as dividends move toward their 40%–50% medium-term dividend payout objective midpoint). - Management expects CET1 to trend toward the midpoint of the 12.5%–13.5% range over time (driven by organic growth, dividends, and continued buybacks).

Earnings drivers & segment highlights (what investors should focus on) - Personal Banking Canada: record revenue (+4% YoY), mortgage sequential growth 1.8% (highest since HSBC Canada acquisition); credit cards +7% YoY (Avion Rewards activity strong). - Commercial Banking: record net income $936M (+12% YoY); pre-provision, pre-tax $1.5B (record); deposit growth +9% YoY and loan growth +4% YoY; ROE 18.6%. - RBC Capital Markets: record revenue & net income $1.5B (+16% YoY); investment banking revenue +23% YoY; equities momentum and strong financing/equities derivatives; loan growth in corporate driven by investment-grade and securitization finance. - Wealth Management: record revenue/net income, net income $1.4B (+32% YoY); AUA +20% (Canada) and +14% (U.S.); transactional strength supported by increased activity.