Royal Bank of Canada reports record C$6.02 billion in fiscal third quarter

TD, CIBC also top expectations as Canada’s banks weather US tariffs

Royal Bank of Canada reported record net income of 6.02 billion Canadian dollars (US$4.34 billion) for its fiscal third quarter ended July 31, beating analyst expectations and capping a strong reporting period for Canada’s largest lenders.

The result came against C$5.41 billion, or C$3.75 a share, a year earlier. Adjusted per-share earnings came in at C$4.28 for the three months to July 31, beating the C$4.07 expected by analysts polled by FactSet. Total revenue increased 9.1% to C$18.54 billion, where analysts were expecting C$18.2 billion.

Toronto-Dominion Bank, Canada’s second-largest bank by assets, recorded third-quarter net income of C$4.62 billion, or C$2.74 a share, against C$3.34 billion, or C$1.89 a share, a year earlier. On an adjusted basis, TD’s per-share earnings came in at C$2.77, beating the C$2.47 mean estimate of analysts. Revenue was 10% higher at C$16.89 billion, ahead of the roughly C$15 billion expected.

Canadian Imperial Bank of Commerce released results the same day, with quarterly net income rising to C$2.41 billion, or C$2.47 a share, from C$2.1 billion, or C$2.15 a share, a year earlier. CIBC’s adjusted earnings jumped 26% to C$2.73 a share — a ninth consecutive quarter of double-digit growth — and ahead of the C$2.53 mean estimate. Revenue for the three months increased 15% to C$8.37 billion, above the C$8.06 billion analysts anticipated.

RBC, Canada’s biggest bank by market value and one of the largest in North America by assets, said growth was broad across its business segments. The bank was buoyed by higher fee-based revenue, reflecting strength in financial markets during the period, while revenue in its capital markets segment was driven by a rise in corporate and investment banking and global markets activity. Net interest income was lifted by average volume growth in personal banking, commercial banking and wealth management.

“The Canadian economy and labor market have performed well, having already absorbed multiple shocks over the past 18 months,” RBC Chief Executive Dave McKay told investors. “Our clients have also continued to spend and delinquencies remain well-controlled.”

TD said the lender had seen momentum in the U.S. and plans to add 100 branches in the country by the end of 2028 as it rebuilds following failings in its anti-money laundering program that led it to accept limits on its growth in the U.S. CIBC CEO Harry Culham said the lender approached the remainder of fiscal 2026 with “measured confidence,” pointing to an unchanged playbook of remaining close to clients, maintaining credit discipline and investing strategically in the bank’s platform.

“The trade environment will continue to evolve and we aren’t going to speculate on where it lands,” Culham said. “What we can control is how we show up for our clients and how we run our bank.”

Royal Bank’s return on equity, a closely watched measure of profitability and efficiency, continued to lead its peers and expanded to an adjusted 18.1% in the recent quarter from 17.7% the year before. TD’s return on equity advanced to 15.8% from 11.3% a year earlier, and CIBC’s improved to 16.8% from 16.4%. Each of the lenders continued to maintain a common equity Tier 1 capital ratio well above the minimum required by the industry regulator, even as they continued to buy back shares.

Canada’s six largest banks are looking to maintain the momentum through the remainder of the year, backed by loan-loss provisioning executives said captures heightened risk. The latest tariffs being imposed by the U.S. aren’t expected to derail growth or the recovery expected for Canada’s economy, bank executives said. The banks remain wary of headwinds from U.S. trade policy and higher crude oil prices linked to the conflict in the Middle East, but forecast official data due out Friday to show Canada’s economy rebounded solidly in the second quarter after back-to-back quarterly contractions. Growth for the full year is expected to be weak after the rough start to 2026 but pick up next year, with fresh U.S. tariffs on a range of goods imported from Canada expected to knock half a percentage point or less off gross domestic product.