Royal Bank Of Canada · TSX:RY
Royal Bank Of Canada — Q3 2025 Earnings Presentation
55 slides from Royal Bank Of Canada's earnings presentation, Aug 27, 2025
Slide 1: Royal Bank of Canada Third Quarter Results
Royal Bank of Canada Third Quarter Results August 27, 2025 All amounts are in Canadian dollars unless otherwise indicated and are based on financial statements prepared in compliance with International Accounting Standard 34 Interim Financial Reporting, unless otherwise noted. Totals may not add, an
Slide 2: Caution regarding forward looking statements
Caution regarding forward looking statements From time to time, we make written or oral forward-looking statements within the meaning of certain securities laws, including the “safe harbour” provisions of the United States Private Securities Litigation Reform Act of 1995 and any applicable Canadian
Slide 3: Overview
Overview Dave McKay President and Chief Executive Officer 3
Slide 4: Q3/25 Key Messages: Record performance driving premium profitability
Q3/25 Key Messages: Record performance driving premium profitability Reported NIAT Adjusted PPPT(1)(4) Reported Adjusted(1) Reported Adjusted(1) Record results underpinned by solid growth across our $3.75 $3.84 businesses 21% 25% 21% 18% Earnings growth Diluted Earnings per Share (EPS) Diluted EPS g
Slide 5: Client assets and activity: Diversified growth across our businesses
Client assets and activity: Diversified growth across our businesses Average Loans & Acceptances and Deposits Average Loans & Acceptances and Deposits Loans and Market Share(1) Personal Banking | $BN Commercial Banking | $BN Capital Markets | $BN +3% LTM(2) GIB(3) +3% +6% league ranking +3% +1% 300
Slide 6: Key trends amidst a challenging backdrop
Key trends amidst a challenging backdrop Personal Banking - Canada: Cardholder spend Personal Banking - Canada: Flow of funds Commercial Banking: Loan growth and volumes(1) | Indexed May 2024 = 100 QoQ change | $ utilization rates | QoQ Change ($) | % Utilization Grocery Travel Discretionary goods C
Slide 7: Financial Review
Financial Review Katherine Gibson Chief Financial Officer 7
Slide 8: Q3/25: Record results underpinned by strong all-bank operating leverage
Q3/25: Record results underpinned by strong all-bank operating leverage(1) Financial Results Reported Earnings $ MM (except for EPS) Q3/2025 YoY QoQ ▪ Net income is up 21% YoY Revenue 16,985 16% 8% Net Interest Income 8,351 14% 4% ▪ Adjusted net income(2) is up 17% YoY Non-Interest Income 8,634 18%
Slide 9: Capital: Strong position supports continued investment and shareholder returns
Capital: Strong position supports continued investment in businesses and shareholder returns CET1(1) Movement ▪ CET1 ratio(1) of 13.2%, flat QoQ, reflecting: 77 bps (33) bps (16) bps (14) bps (10) bps (6) bps 5 bps + Strong net internal capital generation ‒ Higher RWA(1) from client driven growth, U
Slide 10: Net interest income: Higher spreads and volume growth
Net interest income: Higher spreads and volume growth All-Bank Net Interest Income | $ MM Average Earning Assets | $ BN All-Bank NIM (AEA)(1) Decomposition 1.58% 1.64% 1.61% YoY +12% YoY Q2/25 All Bank NIM ex-Trading(3) 2.14% +3 bps 2,011 2,059 71 76 +19% Personal Banking and 8,351 +14% 1,843 0.02%
Slide 11: Non-interest expense: Higher staff-related costs and ongoing technology investments
Non-interest expense: Higher staff-related costs and ongoing technology investments Drivers of expense growth | $ MM Drivers of expense growth | $ MM % of LTM NIE Q3/24 Expenses 8,599 Q3/24 8,599 33% Salaries & Benefits 100 Salaries Variable compensation 269 29% Variable & share- Core expense driver
Slide 12: Personal Banking: Record results reflect strong revenue growth
Personal Banking: Record results reflect strong revenue growth and positive operating leverage(1) Key Metrics(2) Q3/2025 Highlights Reported $ MM (unless otherwise stated) Q3/2025 Personal Banking YoY QoQ ▪ Net income up 22% or 22% YoY adjusted(3); PPPT(3) up 22% YoY Revenue 5,060 13% 5% Net interes
Slide 13: Commercial Banking: Solid positive operating leverage
Commercial Banking: Solid positive operating leverage(1) with relatively stable Stage 3 PCL Key Metrics(2) Q3/2025 Highlights Reported $ MM (unless otherwise stated) Q3/2025 ▪ Net income up 2% or 2% YoY adjusted(3); PPPT(3) up 8% YoY YoY QoQ ▪ Revenue up 6% YoY Revenue 2,152 6% 4% Net interest incom
Slide 14: Wealth Management: Revenue growth supported by strong growth in client assets
Wealth Management: Revenue growth supported by strong growth in client assets Key Metrics(1) Q3/2025 Highlights Reported $ MM (unless otherwise stated) Q3/2025 YoY QoQ ▪ Net income up 15% or 15% YoY adjusted(2); PPPT(2) up 13% YoY Revenue 5,513 11% 2% Net interest income 1,321 6% 2% ▪ Revenue up 11%
Slide 15: Capital Markets: Strong PPPT earnings underpinned by record revenue
Capital Markets: Strong PPPT(1) earnings underpinned by record revenue of $3.8 billion Key Metrics(2) Q3/2025 Highlights Reported $ MM (unless otherwise stated) Q3/2025 ▪ Net income up 13% YoY; PPPT(1) up 36% YoY YoY QoQ Revenue 3,758 25% 14% ▪ Revenue up 25% YoY Corporate & Investment Banking 1,761
Slide 16: Insurance: Strong results reflecting favourable claims experience
Insurance: Strong results reflecting favourable claims experience Key Metrics(1) Q3/2025 Highlights Reported ▪ Net income up 45% YoY $ MM (unless otherwise stated) Q3/2025 YoY QoQ ▪ Revenue up 29% YoY Revenue 368 29% 9% Insurance Service Result 279 30% 25% + Insurance service result up 30% YoY Insur
Slide 17: Risk Review
Risk Review Graeme Hepworth Chief Risk Officer 17
Slide 18: Allowance for Credit Losses: Prudent reserve levels on performing loans
Allowance for Credit Losses: Prudent reserve levels on performing loans Allowance for Credit Losses (ACL) on Loans & Acceptances (L&A) | $ MM L&A: $1,014BN L&A: $1,033 BN ACL to L&A: 0.74% PCL on Performing Loans of ($28MM) 913 ACL to L&A: 0.74% 87 48 (724) 7,642 (163) 7,481 7,481 7,405 7,405 7,453
Slide 19: Gross Impaired Loans: New formations trended lower
Gross Impaired Loans: New formations trended lower Gross Impaired Loans (GIL) | $ MM | BPS Key Drivers of GIL (QoQ) 88 85 ▪ Total GIL decreased $188MM QoQ (down 3 bps) due to lower impaired loans in 78 Commercial Banking and Capital Markets, partially offset by higher impaired loans in Personal Bank
Slide 20: PCL on Impaired Loans: Relatively flat PCL on impaired loans
PCL on Impaired Loans: Relatively flat PCL on impaired loans Total RBC | $ MM | BPS Wealth Management (including CNB) | $ MM | BPS ▪ Wealth Management: Provisions were down $54MM QoQ, mainly driven by reversals in CNB in the Automotive Average historical loss rate(1): 30 bps sector 15 16 ▪ Personal
Slide 21: Appendices
Appendices 21
Slide 22: Accelerating Our Ambitions: Client Focused, Future Ready
Accelerating Our Ambitions: Client Focused, Future Ready 1 2 3 4 5 Canada Global Innovation Risk Management OneRBC Extend our Expand in global fee Create value from data Maintain strong Connect our leadership position pools, including scale and artificial financial and non- businesses and in Canada
Slide 23: Driving strong value creation through the cycle
Driving strong value creation through the cycle Diversified Investing Disciplined risk and Reimagining business model for growth expense management Innovation As at Q3/2025 $64BN $2T ~1:1 LTM Q3/2025 Total Spot Assets 129% 74 bps ACL(4) to loans ratio Revenue (as at Q3/2025) Canadian Banking Liquidi
Slide 24: Net Interest Margin: Average rates and balances
Net Interest Margin: Average rates and balances Interest Income Yield(1) Average Assets | $ BN Q3/24 Q4/24 Q1/25 Q2/25 Q3/25 Q3/24 Q4/24 Q1/25 Q2/25 Q3/25 Loans 5.96% 5.89% 5.69% 5.50% 5.49% Loans 964 973 999 1,006 1,014 Securities 4.20% 4.08% 3.82% 3.88% 3.83% Securities 425 433 502 512 524 Repo &
Slide 25: Net Interest Income: Interest rate sensitivity
Net Interest Income: Interest rate sensitivity All-Bank: Impact of 100 bps change across the curve(1)(7) | $ MM Impact of 25 bps decrease(2) | $ MM Q2/25 Q3/25 Revenue Short-term rates(2) Across the curve(2) Net Interest Income Increase Decrease Increase Decrease Q2/25 Q3/25 Q2/25 Q3/25 Canadian Dol
Slide 26: Net Interest Margin: Canadian Banking and City National
Net Interest Margin: Canadian Banking and City National Canadian Banking NIM(1) QoQ Waterfall CNB NIM(1) QoQ Waterfall 0.04% 0.04% 0.01% (0.01)% (0.04)% (0.03)% 2.92% 2.94% 2.98% 2.97% Q2/25 NIM Rate Impacts Competitive Product Mix/Other Q3/25 NIM Q2/25 NIM Asset Yields Liabilities Cost Mix/Other Q3
Slide 27: Non-Interest Income: Markets and client activity driving growth
Non-Interest Income: Markets and client activity driving growth Non-Interest Income | $MM Q3/2025 Highlights Q3/24 Non-interest income 7,304 ▪ Non-interest income up 18% YoY + Higher investment management & custodial fees driven by higher fee-based client assets Investment, brokerage & custodial fee
Slide 28: Canadian Banking: Strong operating leverage led to a 36% efficiency ratio
Canadian Banking: Strong operating leverage(1) led to a 36% efficiency ratio Key Metrics – Q3/2025(2) Reported Personal Banking – $ millions (unless otherwise stated) Commercial Banking Canadian Banking Canada YoY QoQ Revenue 4,751 2,152 6,903 11% 5% Net interest income 3,450 1,828 5,278 12% 5% Non-
Slide 29: Canadian Banking: Our ~17MM clients continue to adopt our digital channels
Canadian Banking: Our ~17MM clients continue to adopt our digital channels Active Digital Users(1) | ‘000 Digital Personal Adoption Rate(2) Active Mobile Users(1) | ‘000 +4% +70 bps +7% Pre- pandemic Pre- pandemic 9,718 10,176 10,138 64.2% 63.4% 8,067 8,178 62.7% 7,609 Pre- 7,354 pandemic 54.4% 4,61
Slide 30: U.S. Region: Strong earnings growth driven by CNB and Capital Markets
U.S. Region: Strong earnings growth driven by solid results for CNB and Capital Markets Key Metrics Q3/2025 Highlights | US$ MM US$ MM (unless otherwise stated) Q3/2025 YoY QoQ ▪ Net income up 21% YoY Net Income 635 21% 28% Efficiency Ratio(2) 81.5% (6.6) pts 0.8 pts ▪ Revenue ROE(2) 9.8% 0.9 pts 1.
Slide 31: Corporate Support
Corporate Support Financial Performance | $ MM Q3/2025 Highlights Reported Q3/2025 Q2/2025 Q3/2024 ▪ Net income of $(31)MM, up from $(208)MM a year ago, reflecting: Revenue (teb(1)) 134 (231) (148) + Prior year results included the impact from HBCA(3) transaction and integration costs of $125MM U.S.
Slide 32: Non-Interest Expense: Market volatility led to increase in share-based compensation
Non-Interest Expense: Market volatility led to increase in share-based compensation SBC (incl. U.S. WM WAP) had a $94MM impact on YoY expense growth $ millions (unless otherwise stated) Q2/23 Q3/23 Q4/23 Q1/24 Q2/24 Q3/24 Q4/24 Q1/25 Q2/25 Q3/25 Share-based compensation 132 243 (17) 397 179 235 148
Slide 33: Market Risk Trading Revenue and Trading VaR
Market Risk Trading Revenue and Trading VaR $MM 29 25 24 28 60 50 40 30 20 10 0 -10 -20 -30 -40 -50 Aug 30, 2024 Sep 30, 2024 Nov 29, 2024 Dec 31, 2024 Feb 28, 2025 Mar 31, 2025 May 30, 2025 June 30, 2025 Aug 1, 2024 Oct 31, 2024 Jan 31, 2025 Apr 30, 2025 July 31, 2025 Trading Revenue (teb)(1) Tradi
Slide 34: Impact of foreign currency translation
Impact of foreign currency translation Estimated impact of foreign currency translation on key income statement items Relevant average exchange rates that impact our business For the three months ended Q3/25 vs. Q3/25 vs. For the three months ended ($ millions, except per share amounts) (Average for
Slide 35: Personal Banking - Canada: Strong client profile
Personal Banking - Canada: Strong client profile Personal Banking - Canada PCL on Impaired Loans and Gross Impaired Loans Personal Banking - Canada Retail Credit Bureau Score Distribution (Q3/25) Q3/25 PCL on Impaired Loans Gross Impaired Loans Avg Credit Avg Loan (bps)(1) (bps) Bureau 3.8% <636 Bal
Slide 36: Canadian Residential Portfolio: Strong underlying credit quality
Canadian Residential Portfolio: Strong underlying credit quality Canadian Residential Mortgage Portfolio(1) | $ BN Canadian Banking RESL Portfolio (1)(2) $227.7 Insured Uninsured Total $456BN Uninsured $394BN Mortgage Balance $418BN $356BN $90.2 $360.6 (20%) (80%) HELOC Balance $38BN $38BN LTV at Or
Slide 37: Allowance for Credit Losses: Prudently reserved
Allowance for Credit Losses: Prudently reserved Allocation of ACL by Product as a % of Loans & Acceptances Q3/24 Q2/25 Q3/25 Product Stage 1 & 2 Total Stage 1 & 2 Total Stage 1 & 2 Total Residential mortgages(1) 0.08% 0.13% 0.10% 0.15% 0.10% 0.16% Other Retail 1.73% 1.92% 1.93% 2.15% 1.89% 2.11% Per
Slide 38: Funding: Well-diversified
Funding: Well-diversified LCR (1) | $ BN | total adjusted value ▪ As at July 31, 2025, relationship-based deposits, which are the primary source of funding for retail and commercial lending, were $987 billion High-quality Net Cash Surplus Less = or 54% of our total funding (including short-term repo
Slide 39: Items impacting results
Items impacting results 2025 | $ MM, except for EPS Adjusting Item Segments Line Item Before-Tax After-Tax Diluted EPS Q3/2025 Amortization of acquisition-related intangibles Yes Multiple Segments Expenses $(153) $(120) $(0.09) Purchase accounting accretion of fair value adjustments Personal Banking
Slide 40: Items impacting results
Items impacting results 2024 | $ MM, except for EPS Adjusting Item Segments Line Item Before-Tax After-Tax Diluted EPS Q4/2024 Legal provisions No Capital Markets Expenses $(93) $(93) $(0.07) Purchase accounting accretion of fair value adjustments Personal Banking and No Net Interest Income $130 $94
Slide 41: Items impacting results
Items impacting results 2024 | $ MM, except for EPS Adjusting Item Segments Line Item Before-Tax After-Tax Diluted EPS Q1/2024 $(115)/ Cost of the FDIC special assessment No Wealth Management Expenses $(159) / US$(117) $(0.08) US$(85) Amortization of acquisition-related intangibles Yes Multiple Segm
Slide 42: Glossary & Additional Notes
Glossary & Additional Notes 42
Slide 43: Glossary
Glossary Assets under administration (AUA): ▪ Assets administered by us, which are beneficially owned by clients, unless otherwise noted. Services provided in respect of assets under administration are of an administrative nature, including safekeeping, collecting investment income, settling purchas
Slide 44: Glossary
Glossary Liquidity coverage ratio (LCR): ▪ The Liquidity Coverage Ratio is calculated using OSFI’s Liquidity Adequacy Requirements (LAR) guideline. The Liquidity Coverage Ratio is a Basel III metric designed to ensure banks hold a sufficient reserve of high-quality liquidity assets to allow them to
Slide 45: Additional Notes
Additional Notes Dealogic market share for Equity Capital Markets, Debt Capital Markets, loan syndications, and Advisory. Average loans outstanding includes wholesale loans, acceptances, and off- Note 1 balance sheet letters of credit and guarantees for our Capital Markets portfolio, on a single nam
Slide 46: Additional Notes
Additional Notes Total deposit costs is calculated as interest expense on Deposits and Others as a percentage of Average Deposits. Other liabilities cost is calculated as interest expense on other liabilities as a percentage of average other liabilities. Interest cost on repos is calculated as inter
Slide 47: Non-GAAP Measures and Ratios
Non-GAAP Measures and Ratios 47
Slide 48: Non-GAAP measures and ratios
Non-GAAP measures and ratios We use a variety of financial measures and ratios to evaluate our performance. In addition to generally accepted accounting principles (GAAP) prescribed measures, we use certain key performance and non-GAAP measures and ratios we believe provide useful information to inv
Slide 49: Non-GAAP measures and ratios
Non-GAAP measures and ratios Non-GAAP measures Label Composition Usefulness Reconciliation Core expense growth is a useful measure to assess how efficiently costs are being managed and may enhance comparability of our financial performance and enable readers Non-interest expense year-over-year growt
Slide 50: Non-GAAP measures and ratios
Non-GAAP measures and ratios Non-GAAP ratios Label Composition Usefulness Reconciliation The adjusted all-bank efficiency ratio is useful because it may Adjusted all-bank efficiency Adjusted non-interest expense divided by adjusted total enhance comparability in assessing how efficiently costs are S
Slide 51: Reconciliation for non-GAAP financial measures
Reconciliation for non-GAAP financial measures Calculation of Adjusted Net Income and Adjusted Diluted EPS Calculation of Adjusted ROE $ millions (unless otherwise stated) Q3/24 Q2/25 Q3/25 $ millions (unless otherwise stated) Q3/24 Q2/25 Q3/25 All-bank All-bank Net income 4,486 4,390 5,414 Net inco
Slide 52: Reconciliation for non-GAAP financial measures
Reconciliation for non-GAAP financial measures Calculation of Adjusted Effective Tax Rate (teb) Calculation of Core Expense Growth YoY $ millions (unless otherwise stated) Q3/24 Q2/25 Q3/25 $ millions (unless otherwise stated) Q3/24 Q3/25 Change All-bank All-bank Income taxes Expenses 8,599 9,232 63
Slide 53: Reconciliation for non-GAAP financial measures
Reconciliation for non-GAAP financial measures Calculation of Adjusted Net Income Calculation of Adjusted Non-interest Expense, PPPT, and Net Income $ millions (unless otherwise stated) Q3/24 Q2/25 Q3/25 $ millions (unless otherwise stated) Q3/24 Q2/25 Q3/25 Personal Banking Corporate Support Net In
Slide 54: Reconciliation for non-GAAP financial measures
Reconciliation for non-GAAP financial measures Calculation of PPPT Calculation of PPPT $ millions (unless otherwise stated) Q3/24 Q2/25 Q3/25 $ millions (unless otherwise stated) Q3/24 Q2/25 Q3/25 All-Bank Wealth Management Net income 4,486 4,390 5,414 Net income 949 929 1,096 Income taxes 887 1,128
Slide 55: Investor Relations Contacts
Investor Relations Contacts Asim Imran Senior Vice President, Head of Investor Relations (416) 955-7804 www.rbc.com/investorrelations ®/ Trademark(s) of Royal Bank of Canada. ‡ All other trademarks are the property of their respective owner(s). 55