Supplementary Financial Information Q4 008 For the period ended October, 008 (UNAUDITED) For further information, please contact: Marcia Moffat Head, Investor Relations (46) 955-780 marcia.moffat@rbc.com Josie Merenda Director, Investor Relations (46) 955-7809 josie.merenda@rbc.com Bill Anderson Director, Investor Relations (46) 955-7804 william.anderson@rbc.com www.rbc.com/investorrelations
Table of Contents Page Page Notes to Users Capital 8 Capital Key performance and Non-GAAP measures 9 Risk-adjusted assets - Basel II Glossary 0 Risk-adjusted assets - Basel I Regulatory capital generation Financial Highlights Economic capital Financial asset securitization - capital charges Consolidated Results Securitization subject to early amortization - seller's interest 5 Statements of income 5 Revenue from trading activities Credit Quality 6 Non-interest expense Loans and acceptances 7 Other earnings measures and Defined operating leverage 4 Gross impaired loans 7 Goodwill 6 Provision for credit losses 7 Allowance for credit losses Segment Details 9 Credit quality ratios 8 Canadian Banking 9 Wealth Management Credit Risk Exposure 0 Insurance 0 Credit risk exposure by geography and portfolio International Banking Exposure covered by credit risk mitigation Capital Markets Credit exposure by residual contractual maturity Corporate Support Credit exposure of portfolios under the standardized approach Discontinued Operations approach by risk weight Retail credit exposure by portfolio and risk category On- and Off-Balance Sheet Wholesale credit exposure by portfolio and risk rating 4 Balance sheets (period-end balances) 5 Selected average balance sheet items Calculation of ROE and RORC 5 Assets under administration and management 5 Statements of comprehensive income 6 Statements of changes in shareholders' equity 7 Loan securitization
Notes to Users The financial information in this document is in Canadian dollars and is based on financial statements prepared in accordance with Canadian generally accepted accounting principles (GAAP), unless otherwise noted. This document is not audited and should be read in conjunction with our 008 Annual Report to Shareholders and the Glossary on page of this document. Certain comparative amounts have been reclassified to conform to the current period's presentation. Significant reporting changes made to this document in Q4/08 Allowance for credit losses In Q4/08, our segment results for Corporate Support included changes in the Allowance for credit losses - General allowance. Group Risk Management effectively controls the general allowance through its monitoring and oversight of various portfolios of loans throughout the enterprise and reviews the general allowance by product type on an quarterly basis. Prior to Q4/08, changes in the Allowance for credit losses - General allowance were included in Canadian Banking, International Banking and Capital Markets. We have reflected this management change prospectively as of Q4/08. Comparative segment results were not restated to reflect this management change given the insignificance of its impact on comparative periods. This change does not impact our previously reported consolidated financial information. Trading revenue reclassification We reclassified certain Trading revenue reported for the quarters ended Q/07 to Q4/08 in Capital Markets from Non interest income - Trading revenue to Non-interest income - Other including Trading revenue by products to better reflect its nature. There was no impact to Total revenue as a result of this reclassification. Significant reporting changes made to this document in Q/08 RBC creates Insurance segment We created our Insurance segment, formerly a business under Canadian Banking, and renamed our U.S. & International Banking segment International Banking. The historical comparative segment financial information was restated to reflect the realignment of our business segments. RBC now consists of five business segments: Canadian Banking, Wealth Management, Insurance, International Banking and Capital Markets. The restated historical segment financial information for Canadian Banking and Insurance did not impact our previously reported consolidated financial information. Net interest income reclassification We reclassified certain Trading revenue reported in Q4/07, Q/08 and Q/08 in Capital Markets from Net interest income - Interest income to Non-interest income - Other to better reflect its nature. There was no impact to Total revenue as a result of this reclassification. Gross impaired loans (GIL) - Wholesale - Business information We revised GIL information in our Wholesale - Business - Real estate and related sector to exclude certain foreclosed assets. GIL, Net impaired loans information, Specific ACL as a % of GIL and related condition ratios for our U.S. Wholesale portfolio have been revised to reflect the change. Net write-offs as a % of Average Net Loans and Acceptances coverage ratio calculation We revised our calculation of the geographic coverage ratio for Net write-offs as a % of Average Net Loans and Acceptances for Canada, U.S. and Other International to Net write-offs divided by Average net loans and acceptances for each of the geographies. Previously, the coverage ratio was calculated using Total average net loans and acceptances. Significant reporting changes made to this document in Q/08 Gross insurance premiums and deposits We revised the gross insurance premiums and deposits balances in Insurance to include our segregated funds deposits consistent with insurance industry practices. Comparative amounts have been revised to reflect this change. Transfer of U.S. subprime and collaterialized debt obligation (CDO) available-for-sale portfolio to Corporate Support We transferred management oversight of our Wealth Management U.S. subprime and CDO available-for-sale portfolio to Corporate Support, where we have greater expertise in managing these types of investments, particularly during current market conditions. Comparative segment results were not revised to reflect this management change given the insignificance of its impact on comparative periods. Securities - Trading and Available-for-sale reclassifications We reviewed and reclassified certain U.S. municipal debt held in our Tender Option Bond (TOB) programs from Securities - Trading to Securities - Available-for-sale. The reclassifications did not impact total Securities. The related impact to Net income and Accumulated other comprehensive income was not significant and has been reflected in Q/08. Comparative amounts on the Balance Sheet have been revised to reflect this change. Loan portfolio information reclassifications We reclassified certain loans in our Wholesale - Bank portfolio - Canada to Wholesale - Non-banking financial services - Other international. This reclassification did not impact total Loans and acceptances or Net income. Comparative amounts and related credit quality ratios have been revised to reflect this change. Significant reporting changes made to this document in Q/08 U.S. loan portfolio information For the three and months ended October, 007, we reclassified (i) new impaired loans and gross impaired loans, (ii) net impaired loans, and (iii) allowance for credit losses and provision for credit losses, which were overstated by $0 million, $ million and $8 million, respectively, in our U.S. retail residential mortgage portfolio and were understated by $0 million, $ million and $8 million, respectively in our U.S. wholesale real estate and related portfolio. Aggregate amounts of new impaired loans, gross impaired loans, net impaired loans, allowance for credit losses and provision for credit losses are unchanged. These reclassifications did not impact our consolidated net income or Balance Sheet. Net interest income reclassification We reclassified certain Trading revenue reported in Q4/07 in Capital Markets from Non-interest income - Trading revenue to Net interest income to better reflect its nature. There was no impact to Total Trading revenue as a result of this reclassification. Comparative amounts in Q4/07 for Net interest income, Non-interest income - Trading revenue, Net interest margin and Non-interest income as a percentage of Total revenue reflect the Assets under administration We revised the calculation for assets under administration for Canadian Banking to reflect the inclusion of mutual funds sold through our Canadian branch network. Comparative amounts have been revised to reflect this change. Economic capital We enhanced our Economic Capital methodologies and parameters, which mainly resulted in a decrease of capital for non-trading market risk allocated to our business segments and to an increase of capital for credit risk allocated to Capital Markets. --
Key performance and Non-GAAP measures Management measures and evaluates the performance of our consolidated operations and each of our segments based on a number of different measures including net income and non-gaap measures. For details, refer to How we measure and report our business segments in our 008 Annual Report to Shareholders. We also include non-gaap cash basis financial measures in this document which we believe provides investors with supplemental information that may be useful in comparing to other financial institutions. However, readers are cautioned that the following non-gaap financial measures do not have any standardized meaning prescribed by GAAP and therefore may not be comparable to similar measures presented by other companies. Performance measures Risk capital Risk capital includes credit, market (trading and non-trading), insurance-specific, operational, business and fixed assets risk capital. Attributed capital (Economic capital) An estimate of the amount of equity capital required to underpin risks. It is calculated by estimating the level of capital that is necessary to support our various businesses, given their risks, consistent with our desired solvency standard and credit ratings. Unattributed capital Unattributed capital represents common equity in excess of common equity attributed to our business segments and is reported in the Corporate Support segment. Average risk capital Calculated using methods intended to approximate the average of the daily risk capital balances for the period. Return on risk capital (RORC) Net income available to common shareholders divided by average risk capital. Refer to page for the business segments' RORC calculation. Business segment RORC is calculated as net income available to common shareholders divided by average risk capital for the period. Return on equity (ROE) Business segment return on equity is calculated as net income available to common shareholders divided by average attributed capital for the period. Corporate Support also includes average unattributed capital. Refer to page for calculation of ROE. Non-GAAP measures Cash basis measures Cash basis measures such as cash net income, cash diluted earnings per share (EPS) and cash ROE are calculated by adding back to net income the after-tax amount of the amortization of other intangibles. These non-cash charges do not deplete our cash reserves. Defined operating leverage Our defined operating leverage is defined as the difference between revenue growth rate (as adjusted) and non-interest expense growth rate (as adjusted). Revenue is based on a taxable equivalent basis, excluding consolidated variable interest entities (VIEs) and Insurance revenue. Our revenue in 007 excludes accounting adjustments related to the financial instruments accounting standards. Non-interest expense excludes Insurance expense. Economic profit Economic profit is net income available to common shareholders excluding the after-tax effect of amortization of other intangibles, less a capital charge for use of attributed capital. Glossary Assets-to-capital multiple Total assets plus specified off-balance sheet items, as defined by OSFI, divided by total regulatory capital. Assets under administration (AUA) Assets administered by us, which are beneficially owned by clients. Services provided in respect of assets under administration are of an administrative nature, including safekeeping, collecting investment income, settling purchase and sale transactions, and record keeping. Assets under management (AUM) Assets managed by us, which are beneficially owned by clients. Services provided in respect of assets under management include the selection of investments and the provision of investment advice. We have assets under management that are also administered by us and included in assets under administration. Goodwill and intangibles Represents our net investment in goodwill and intangibles. Taxable equivalent basis (teb) Income from certain tax-advantaged sources are reported on a taxable equivalent basis (teb). Under this approach, revenue from tax-advantaged sources are grossed up, which currently includes only our Canadian taxable corporate dividends recorded in Net interest income, to their tax equivalent value with a corresponding offset recorded in the provision for income taxes. We record teb adjustments in Capital Markets and record elimination adjustments in Corporate Support thereby generating the same after-tax net income as reported under GAAP. Total trading revenue Total trading revenue is comprised of trading related revenue recorded in Net interest income and Non-interest income. Calculations Average balances (assets, loans and acceptances, and deposits) Calculated using methods intended to approximate the average of the daily balances for the period. Average common equity Calculated as the average of the month-end common equity balances for the period. For the business segments, calculated using methods intended to approximate the average of the daily attributed capital for the period. Average earning assets The average carrying value of deposits with banks, securities, assets purchased under reverse repurchase agreements and certain securities borrowed, and loans based on daily balances for the period. Capital charge Calculated by multiplying the cost of capital by the amount of average common equity. The cost of capital is a proxy for the after-tax return that we estimate to be required by shareholders for the use of their capital. The cost of capital is regularly reviewed and adjusted from time to time based on prevailing market conditions. Market capitalization End of period common shares outstanding multiplied by the closing common share price on the Toronto Stock Exchange. Net interest margin (average assets) Net interest income divided by average assets. Net interest margin (average earning assets) Net interest income divided by average earning assets. Ratios Capital ratios The percentage of risk-adjusted assets supported by capital, using the guidelines of the Office of the Superintendent of Financial Institutions Canada (OSFI) based on standards issued by the Bank for International Settlements and Canadian GAAP financial information. Efficiency ratio Non-interest expense as a percentage of total revenue. Return on assets Net income divided by average assets. Net write-offs Gross write-offs less recoveries of amounts previously written off. Risk-adjusted assets - Basel I Used in the calculation of risk-based capital ratios as defined by guidelines issued by OSFI. The face value of assets is discounted using risk-weighting factors in order to reflect a comparable risk per dollar among all types of assets. The risk inherent in off-balance sheet instruments is also recognized, first by determining a credit equivalent amount, and then by applying appropriate risk-weighting factors. Specific and general market riskadjusted assets are added to the calculation of the Balance Sheet and off-balance sheet risk-adjusted assets to obtain the total risk-adjusted assets. Risk-adjusted assets - Basel II Return on common equity (ROE) Used in the calculation of risk-based capital ratios as defined by guidelines issued by OSFI based on Basel II, Net income available to common shareholders divided by average common equity for the period. Refer to page effective November, 007. A majority of our credit risk portfolios use the AIRB Approach and the remainder for ROE calculation. use a Standardized Approach for the calculation of Risk-adjusted assets (RAA) based on the total exposure, i.e. exposure at default, and counterparty risk weights. For market risk RAA measurement, we use internal models approach for products with regulatory approval and a standardized approach for products to be approved For Operational risk, we use the Standardized Approach. In addition, Basel II requires a transitional capital floor adjustment. For more details, refer to our 008 Annual Report. --
FINANCIAL HIGHLIGHTS (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 SELECTED INCOME STATEMENT INFORMATION Total revenue 5,069 5,9 4,954 5,647 5,65 5,480 5,669 5,698 5,49,58,46 0,67 9,84 Provision for credit losses (PCL) 69 4 49 9 6 78 88 6 59,595 79 49 455 Insurance policyholder benefits, claims and acquisition expense (86) 55 548 66 67 4 677 56 6,6,7,509,65 Non-interest expense (NIE),989,7,970,0,09,65,48,067,955,5,47,495,57 Net income from continuing operations,0,6 98,45,4,95,79,494,6 4,555 5,49 4,757,47 Net loss from discontinued operations - - - - - - - - () - - (9) (50) Net Income,0,6 98,45,4,95,79,494,6 4,555 5,49 4,78,87 Net income available to common shareholders,09,5 905,,00,69,57,478,6 4,454 5,404 4,668,49 PROFITABILITY MEASURES Total Earnings per share (EPS) - basic $0.8 $0.9 $0.70 $0.96 $.0 $.07 $0.99 $.6 $0.97 $.4 $4.4 $.65 $.6 - diluted $0.8 $0.9 $0.70 $0.95 $.0 $.06 $0.98 $.4 $0.96 $.8 $4.9 $.59 $.57 Return on common equity (ROE) 6.% 9.4% 5.6%.4%.0% 4.4%.5% 7.%.9% 8.0% 4.6%.5% 8.0% Return on risk capital (RORC) 6.%.% 6.0% 5.6% 5.8% 6.9% 5.% 4.6% 7.% 9.6% 7.4% 6.7% 9.% Return on assets 0.66% 0.78% 0.58% 0.79% 0.88% 0.94% 0.9%.06% 0.95% 0.70% 0.95% 0.94% 0.76% Return on risk-adjusted assets.60%.00%.5%.05%.%.%.6%.45%.4%.78%.%.%.77% Efficiency ratio 59.0% 55.% 60.0% 55.% 55.% 57.8% 55.5% 5.8% 55.% 57.% 55.5% 55.7% 59.% Continuing Operations Earnings per share (EPS) - basic $0.8 $0.9 $0.70 $0.96 $.0 $.07 $0.99 $.6 $0.97 $.4 $4.4 $.67 $.65 - diluted $0.8 $0.9 $0.70 $0.95 $.0 $.06 $0.98 $.4 $0.96 $.8 $4.9 $.6 $.6 Return on common equity (ROE) 6.% 9.4% 5.6%.4%.0% 4.4%.5% 7.%.6% 8.0% 4.6%.% 8.% Return on risk capital (RORC) 6.%.% 6.0% 5.6% 5.8% 6.9% 5.% 4.6% 7.% 9.6% 7.4% 7.0% 9.7% Discontinued Operations Earnings per share (EPS) - basic - - - - - - - - $0.00 - - ($0.0) ($0.04) - diluted - - - - - - - - $0.00 - - ($0.0) ($0.04) KEY RATIOS Diluted EPS growth (9.8)% (.)% (8.6)% (6.7)% 5.% 7.8% 5.% 8.% 46.% (9.)% 6.7% 9.7%.8 % Diluted EPS growth - continuing operations (9.8)% (.)% (8.6)% (6.7)% 5.% 6.5% 4.0% 8.% 4. % (9.)% 6.% 8.% 4.5 % Revenue growth (9.7)% 7.9 % (.6)% (0.9)% 5.0% 5.% 0.7% 4.9%.5% (.9)% 8.8% 7.6% 7.8% NIE growth (.4)%.4 % (5.7)%.7 % 4.7% 0.6 % 7.5 %.5 % (0.7)% (.0)% 8.5%.% 4.8 % Defined operating leverage 9.5 % 0.6 % (5.9)% (0.)%.0%.%.7% 5.8%. %.0 %.6 %.5 % 7.5 % Specific PCL to average net loans and acceptances 0.65 % 0.47 % 0.54 % 0.44 % 0.4% 0.9% 0.5% 0.9% 0.9% 0.5 % 0.% 0.% 0.% Net interest margin (average assets).59 %.4 %.7 %.6 %.%.%.4%.%.%.44 %.%.5%.5% Non-interest income as % of total revenue 46.6 % 6. % 55.4 % 6. % 64.4% 64.% 66.7% 67.5% 67.6% 56.6 % 65.7% 67.% 64.6% Effective tax rate 7.7 % 5. % 4.4 %. % 5.7% 9.5%.%.%.%.8 % 9.8%.6% 7.% SELECTED BALANCE SHEET INFORMATION Average loans and acceptances 89,800 74,000 64,00 55,400 44,00 6,500 0,00,900 5,00 70,900,500 06,00 86,00 Total assets 7,859 66,79 67,47 6,76 600,46 604,58 589,076 57,65 56,780 7,859 600,46 56,780 469,5 Average assets 677,00 64,900 654,800 66,00 597,500 588,800 578,700 558,900 55,500 650,00 58,000 50,00 447,00 Average earning assets 545,00 58,000 50,00 58,700 506,600 507,00 500,000 48,00 455,900 50,500 499,00 44,00 78,900 Deposits 48,575 409,09 99,45 94,46 65,05 76,5 7,78 65,606 4,5 48,575 65,05 4,5 06,860 Common equity 8,00 6,477,7,98,95,500,05,86,075 8,00,95,075 9,49 Average common equity 7,00 5,400,550,750,450,50,950,450 0,500 4,750,000 9,900 8,600 Average risk capital 6,500 5,750 4,50,650 4,400 4,700 4,650 4,00,50 5,050 4,450,750,450 INTEREST RATE SENSITIVITY Before tax impact of % increase in rates on: Net interest income using simulation 45 5 9 5 54 8 66 8 87 45 54 87 06 Economic value of equity (508) (480) (575) (496) (440) (07) (500) (508) (496) (508) (440) (496) (45) Before tax impact of % decrease in rates on: Net interest income using simulation (90) (57) (5) (87) () (40) () (4) (5) (90) () (5) (8) Economic value of equity 448 97 489 86 09 0 7 77 75 448 09 75 9 Growth rates are calculated based on earnings from continuing operations in the same period a year ago. A $5 million transfer of the specific allowance to the general allowance during 005 decreased this ratio by 0.0%. --
FINANCIAL HIGHLIGHTS continued (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 CAPITAL MEASURES Tier capital ratio - Basel II 9.0% 9.5% 9.5% 9.8% - - - - - 9.0% - - - - Basel I 8.% 8.7% 8.8% 9.% 9.4% 9.% 9.% 9.% 9.6% 8.% 9.4% 9.6% 9.6% Total capital ratio - Basel II.%.7%.5%.% - - - - -.% - - - - Basel I 0.6%.%.0%.0%.5%.4%.7%.%.9% 0.6%.5%.9%.% Assets-to-capital multiple - Basel II 0.X 9.4X 0.X.0X - - - - - 0.X - - - - Basel I 9.9X 9.X 9.8X 0.9X 9.9X 0.5X 0.X 0.7X 9.7X 9.9X 9.9X 9.7X 7.6X Risk-adjusted assets ($ billions) - Basel II 78.6 54. 49. 4. - - - - - 78.6 - - - - Basel I. 8. 7.6 60.0 47.6 50. 4. 4..7. 47.6.7 97.0 SHARE INFORMATION First preferred shares outstanding (000s) - end of period Non-cumulative series N -,000,000,000,000,000,000,000,000 -,000,000,000 Non-cumulative series O - - - - - - - - 6,000 - - 6,000 6,000 Non-cumulative series S - - - - - - - - - - - - 0,000 Non-cumulative series W,000,000,000,000,000,000,000,000,000,000,000,000,000 Non-cumulative series AA,000,000,000,000,000,000,000,000,000,000,000,000 - Non-cumulative series AB,000,000,000,000,000,000,000,000,000,000,000,000 - Non-cumulative series AC 8,000 8,000 8,000 8,000 8,000 8,000 8,000 8,000-8,000 8,000 - - Non-cumulative series AD 0,000 0,000 0,000 0,000 0,000 0,000 0,000 0,000-0,000 0,000 - - Non-cumulative series AE 0,000 0,000 0,000 0,000 0,000 0,000 0,000 0,000-0,000 0,000 - - Non-cumulative series AF 8,000 8,000 8,000 8,000 8,000 8,000 8,000 - - 8,000 8,000 - - Non-cumulative series AG 0,000 0,000 0,000 0,000 0,000 0,000 0,000 - - 0,000 0,000 - - Non-cumulative series AH 8,500 8,500 8,500 - - - - - - 8,500 - - - Non-cumulative series AJ 6,000 - - - - - - - - 6,000 - - - Common shares outstanding (000s) 4 - end of period,4,60,8,08,94,084,76,65,76,60,75,780,75,7,75,950,80,890,4,60,76,60,80,890,9,50 - average (basic),7,75,,9,87,45,7,86,7,005,7,9,7,,74,54,74,697,05,706,7,85,79,956,8,4 - average (diluted),5,588,40,9,98,069,86,595,87,44,88,7,88,45,9,085,9,864,9,744,89,4,99,785,04,680 Treasury shares held - preferred (000s) 60 489 90 49 85 4 94 60 49 94 9 - common (000s),58,09,8,6,444,744,648,08 5,486,58,444 5,486 7,05 Shares repurchased (000s) - - -,0 00,000,900 7,645,80,0,845 8,9 5,9 ($ MM) - - - 55 5 58 59 44 90 55 646 844 6 Stock options outstanding (000s),77 4,754 5,98 7,086 6,6 7,47 8,969,6,4,77 6,6,4 6,48 Stock options exercisable (000s) 7,47 0,8,75,68,94,78 4,0 6,54 6,98 7,47,94 6,98 8,86 COMMON SHARE PERFORMANCE Book value per share $0.99 $9.8 $8.7 $8.04 $7.58 $7.67 $7. $7.7 $6.5 $0.99 $7.58 $6.5 $4.89 Common share price (RY on TSX) - High (intraday) $5.50 $5. $5.76 $55.84 $57.00 $6.08 $59.95 $55.96 $5.44 $55.84 $6.08 $5.49 $4.4 - Low (intraday) $9.05 $9.5 $4.8 $45.5 $50.50 $5.90 $5.50 $49.50 $45.64 $9.05 $49.50 $4.9 $0.45 - Close, end of period $46.84 $47.5 $48.0 $50.65 $56.04 $54.09 $57.8 $54.60 $49.80 $46.84 $56.04 $49.80 $4.67 Market capitalization (TSX) ($ MM) 6,85 6,5 6,4 64,66 7,5 69,007 7,79 69,667 6,788 6,85 7,5 6,788 5,894 P/E ratio (4-quarters trailing earnings) 5.9..9.7.4. 4.5 4..9.9.4.9 6. Market price to book value..8.6.8.9.06.4.8.0..9.0.80 DIVIDEND INFORMATION 6 Dividends declared per share $0.50 $0.50 $0.50 $0.50 $0.50 $0.46 $0.46 $0.40 $0.40 $.00 $.8 $.44 $.8 Dividend yield 4.4% 4.4% 4.% 4.0%.7%.%.%.0%.% 4.%.%.%.% Dividend payout ratio 6% 54% 7% 5% 49% 4% 47% 5% 4% 59% 4% 40% 45% Common dividends ($ MM) 670 669 647 68 67 587 586 5 5,64,,847,5 Preferred dividends ($ MM) 7 7 4 4 6 6 6 0 88 60 4 OTHER INFORMATION Number of employees (full time equivalent) Canada 49,999 50,486 49,8 49,048 48,607 49,070 48,05 47,5 46,4 49,999 48,607 46,4 46,06 US,45,464,08,489,66,95,069 0,576 0,056,45,66 0,056 9,684 Other 9,87 9,8 4,448 4,68 4,545 4,54 4,55 4,9 4,4 9,87 4,545 4,4,97 Total 7, 7,77 66,748 64,905 64,85 65,57 6,9 6,967 60,59 7, 64,85 60,59 59,647 Number of bank branches 7 Canada,74,60,5,50,46,,6,0,7,74,46,7,04 US 49 44 450 49 50 48 45 0 8 49 50 8 7 Other 8 7 45 45 45 44 44 44 44 8 45 44 4 Total,74,79,648,544,54,54,55,467,44,74,54,44,49 Number of automated teller machines (ATM) 4,964 4,897 4,64 4,547 4,49 4,77 4, 4,7 4, 4,964 4,49 4, 4,77 Commencing Q/08, capital ratios and risk-adjusted assets are calculated using guidelines issued by OSFI under the new Basel II framework. Comparative amounts are calculated using guidelines issued by the OSFI under the Basel I framework. Basel I and Basel II are not directly comparable. Effective Q/08, the OSFI amended the treatment of the general allowance in the calculation of the Assets-to-capital multiple under Basel II. Comparative ratios have not been revised. Risk-adjusted assets for April 0, 007 was revised in Q/07 to reflect a $56 million adjustment related to equity derivative contracts. 4 Common shares outstanding at end of period includes Treasury shares (shares acquired and held by subsidiaries for reasons other than cancellation). Average common shares outstanding excludes Treasury shares. 5 Closing share price divided by diluted earnings per share. 6 Calculated using number of common shares outstanding, except as noted. 7 Bank branches which provide banking services directly to clients. -4-
STATEMENTS OF INCOME (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Net interest income Interest income 6,68 5,90 6,75 6,79 6,78 6,745 6,594 6,47 6,0 5,44 6,547,04 6,98 Interest expense,559,609 4,66 4,650 4,78 4,780 4,705 4,577 4,89 5,984 8,845 5,408 0,88 Total,709,0,09,4,998,965,889,850,7 9,60 7,70 6,796 6,79 Non-interest income Accounts 84 6 40 4 49 47 50 40 47,09 986 97 868 Other payment services 87 86 8 8 8 80 78 78 79 8 7 99 85 Service charges 7 49 4 0 7 8 8 6,67,0,6,5 Insurance premiums, investment and fee income 857 800 84 887 590 855 80 86,609,5,48,70 Investment management and custodial fees 449 450 47 4 4 40 94 70 45,759,579,0, Mutual fund revenue 87 44 85 75 7 85 6 54 7,56,47,4 96 Trading revenue (56) 59 (0) 6 68 55 574 806 60 (408),999,574,594 Securities brokerage commissions 90 45 09 4 68 8 96,77,5,4,6 Underwriting and other advisory fees 5 4 6 6 0 09 9 88 9 875,7,04,06 Foreign exchange revenue, other than trading 65 66 49 66 9 8 4 06 646 5 48 407 Card service revenue 8 7 4 59 4 65 4 49 47 648 49 496 579 Credit fees 4 99 84 08 74 7 88 60 6 45 9 4 87 Securitization revenue 7 0 66 9 4 97 9 86 46 6 57 85 Net (loss) gain on available-for-sale securities (7) (6) (89) (0) (4) 4 5 48 - (67) 6 - - Net gain on investment securities - - - - - - - - 6 - - 88 85 Other 655 89 4 4 65 40 5 99 0,59,04 7 448 Total,60,6,745,506,67,55,780,848,68, 4,760,84,9 Total revenue 5,069 5,9 4,954 5,647 5,65 5,480 5,669 5,698 5,49,58,46 0,67 9,84 Provision for credit losses 69 4 49 9 6 78 88 6 59,595 79 49 455 Insurance policyholder benefits, claims and acquisition expense (86) 55 548 66 67 4 677 56 6,6,7,509,65 Non-interest expense,989,7,970,0,09,65,48,067,955,5,47,495,57 Business realignment charges - - - - - - - - - - - - 45 Income taxes 48 44 56 4 55 49 5 45 4,69,9,40,78 Non-controlling interest in net income of subsidiaries () 49 0 4 50 4 4 9 8 4 44 () Net income from continuing operations,0,6 98,45,4,95,79,494,6 4,555 5,49 4,757,47 Net loss from discontinued operations - - - - - - - - () - - (9) (50) Net income,0,6 98,45,4,95,79,494,6 4,555 5,49 4,78,87 Preferred dividends (7) (7) () (4) (4) (6) () (6) (6) (0) (88) (60) (4) Net gain on redemption of preferred shares - - - - - - - - - - - - 4 Net income available to common shareholders,09,5 905,,00,69,57,478,6 4,454 5,404 4,668,49 Revenue from Trading Activities Total Trading revenue Net interest income 468 6 4 6 (7) () () (5) (7) 998 (0) (59) Non-interest income (56) 59 (0) 6 68 55 574 806 60 (408),999,574,594 Total (58) 85 (6) 4 6 50 54 655 447 590,779,05,65 Trading revenue by product Interest rate and credit (78) 06 (7) 50 (46) 88 0 78 55 (59) 640,74,05 Equities (97) 70 70 97 54 0 0 65 784 56 55 Foreign exchange and commodities 7 09 06 5 0 78 9 76 6 584 55 00 5 Total (58) 85 (6) 4 6 50 54 655 447 590,779,05,65 Trading revenue (teb) by product Interest rate and credit (78) 06 (7) 50 (46) 88 0 78 55 (59) 640,74,05 Equities (96) 54 59 5 0 96 70 78 669,07 766 456 Foreign exchange and commodities 7 09 06 5 0 78 9 76 6 584 55 00 5 Total (teb) 4 469 8 454 74 597 607 74 495 994,0,40,76 In Q4/07 Non-interest income - Other includes a $6 million gain related to the Visa Inc. restructuring. Includes precious metals. -5-
NON-INTEREST EXPENSE (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Human resources Salaries,064 966 94 89 898 899 880 864 8,845,54,9,0 Variable compensation 65 76 55 766 65 755 804 79 698,689,975,87,09 Acquisition retention compensation 4 6 4 0 0 Benefits related 8 86 96 9 64 9 94 90 4,55,40,077,08 Stock-based compensation (0) 44 4 49 44 4 58 5 77 94 69 69 Total Human resources,954,0,800,99,89,99,0,007,808 7,779 7,860 7,68 6,68 Equipment Depreciation 8 05 96 9 87 84 8 84 440 45 0 4 Computer rental and maintenance 97 65 6 67 68 57 55 56 66 69 66 609 59 Office equipment rental and maintenance 9 4 6 5 7 7 8 6 7 4 8 8 44 Total Equipment 4 80 7 68 67 5 47 44 57,55,009 957 960 Occupancy Premises rent 87 0 00 99 0 8 04 95 7 87 8 8 4 Premises repairs and maintenance 4 78 78 67 76 69 64 6 64 7 70 5 Depreciation 4 8 5 5 0 99 89 85 90 Property taxes 6 8 6 4 6 5 0 97 9 9 Total Occupancy 49 4 6 00 5 98 5 96 89 79 749 Communications Telecommunications 5 46 50 48 48 49 49 48 46 97 94 86 04 Postage and courier 8 7 0 6 7 5 6 4 0 96 97 Marketing and public relations 0 8 75 67 0 87 8 64 05 4 6 4 Stationery and printing 9 6 0 6 5 0 0 6 98 9 9 90 Total Communications 0 80 78 6 0 86 78 56 00 749 7 687 6 Professional fees 69 7 4 57 4 9 0 4 56 50 546 500 Outsourced item processing 05 77 8 77 75 77 8 74 75 4 08 98 96 Amortization of other intangibles 45 9 9 4 5 5 5 96 76 50 Other Business and capital taxes 6 9 0 5 49 4 0 5 4 7 Travel and relocation 47 4 4 5 4 4 8 4 4 57 58 4 6 Employee training 9 7 4 4 45 54 4 7 Donations 7 4 5 5 5 45 4 Other, (90) 96 6 6 79 9 64 58 45 0 70 56,099 Total Other (97) 00 49 5 0 0 50 46 7 704,08 87,488 Total non-interest expense,989,7,970,0,09,65,48,067,955,5,47,495,57 Stock-based compensation includes the cost of stock options, stock appreciation rights, performance deferred shares, deferred compensation plans and the impact of related economic hedges. In 005, Other includes $9 million for recognition of RBC's claims against the Enron Corp. (Enron) bankruptcy estate, and a provision for Enron-related litigation matters of $59 million. In Q4/08, Other includes reduction of the Enron-related litigation provision of $54 million. -6-
OTHER EARNINGS MEASURES (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Specified Items Income tax reduction - - - - - - - - - - - 70 - Agreement termination fee - - - - - - - - - - - - General allowance reversal - - - - - - - - - - - - Net gain on the exchange of NYSE seats for NYX shares - - - - - - - - - - - - Amounts related to the transfer of IIS to RBC Dexia IS - - - - - - - - - - - (9) - Credit card customer loyalty reward program liability - - - - - - - - - - - (47) - Hurricane-related charges - - - - - - - - - - - (6) (0) Enron litigation-related charges - - - - - - - - - - - - (6) Business realignment charges - - - - - - - - - - - - (7) Cash Basis Measures Net income,0,6 98,45,4,95,79,494,6 4,555 5,49 4,78,87 After-tax effect of amortization of other intangibles 7 6 7 0 87 7 45 Cash Net income,57,98 955,67,46,47,0,54,8 4,677 5,579 4,799,4 Cash Diluted EPS 0.84 0.95 0.7 0.97.0.08 0.99.6 0.97.47 4.6.65.60 Cash ROE 6.% 9.6% 5.9%.6%.% 4.6%.7% 7.5% 4.% 8.% 4.8%.7% 8.% Economic Profit Net income,0,6 98,45,4,95,79,494,6 4,555 5,49 4,78,87 After-tax effect of amortization of other intangibles 7 6 7 0 87 7 45 Capital charge (708) (664) (604) (594) (588) (586) (556) (557) (544) (,570) (,87) (,050) (,90) Economic Profit 449 64 5 67 758 8 746 957 79,07,9,749,59 DEFINED OPERATING LEVERAGE (C$ MM, except percentage amounts) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Total revenue 5,069 5,9 4,954 5,647 5,65 5,480 5,669 5,698 5,49,58,46 0,67 9,84 Add: teb adjustment 0 86 90 7 79 66 70 50 40 09 Less: Revenue related to VIEs (55) 7 (5) 5 () 8 4 (48) (7) (4) Insurance revenue 858 80 840 887 590 855 860 86,60,9,48, Impact of the financial instruments accounting standards (5) - 8 - - Total revenue (adjusted) 5,5 5, 4,58 4,94 4,85 4,9 4,840 4,864 4,5 9,40 9,488 7,509 6,006 Non-interest expense 4,989,7,970,0,09,65,48,067,955,5,47,495 0,766 Less: Insurance related non-interest expense 54 45 4 5 7 7 5 8 4 576 57 57 50 Non-interest expense (adjusted),85,7,88,985,956,08,0,99,8,775,96 0,978 0,65 Defined operating leverage (compared to prior year) 9.5 % 0.6 % (5.9)% (0.)%.0%. %.7 % 5.8%.%.0 %.6%.5% 7.5 % GOODWILL (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Opening balance 8,859 6,65 4,897 4,75 5,055 5,098 4,9 4,04 4,7 4,75 4,04 4,0 4,80 Net goodwill acquired 59,6,70-60 7 57 9 4,06 906 86 0 Other adjustments 5 959 6 () 45 (05) (0) (5) 0 58,6 (458) 5 (87) Closing balance 9,977 8,859 6,65 4,897 4,75 5,055 5,098 4,9 4,04 9,977 4,75 4,04 4,0 Effective Q/07, we no longer classify amounts as specified items. Amounts shown are reported on an after-tax basis. Defined in the "Non-GAAP measures" section. Excludes the impact of the financial instruments accounting standards related to Insurance. 4 In 005, non-interest expense also excludes Enron-related litigation provision. For further details, refer to Specified items above. 5 Other adjustments include primarily foreign exchange translations on non-canadian dollar denominated goodwill. -7-
CANADIAN BANKING (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Income Statement Net interest income,70,694,66,687,64,605,559,547,50 6,78 6,5 5,86 5, Non-interest income 748 749 650 7 94 7 666 674 655,868,976,5,454 Total revenue,449,44,86,408,566,7,5,,85 9,586 9,9 8,48 7,687 Provision for credit losses (PCL) 5 04 4 4 90 04 8 7 867 788 604 54 Non-interest expense,0,86,56,96,,9,60,47,44 4,758 4,748 4,50 4,9 Business realignment charges - - - - - - - - - - - - 7 Other 8 44 0 5 5 95 06 99,99,48,0 957 Net income 676 709 604 67 797 596 566 586 569,66,545,4,85 Total Revenue by business Personal Financial Services,,5,08,,99,84,6,7,0 5,5 5,08 4,6 4,8 Business Financial Services 60 607 584 60 609 585 55 555 559,44,0,4,0 Cards and Payment Solutions 496 485 94 455 658 448 4 49 45,80,946,586,495 Total,449,44,86,408,566,7,5,,85 9,586 9,9 8,48 7,687 Financial ratios Return on equity (ROE) 7.7% 40.4% 5.8% 8.5% 4.7%.%.7%.7%.% 8.% 4.9%.% 9.8% Return on risk capital (RORC) 50.8% 54.% 49.5% 54.% 57.6% 44.4% 44.% 45.6% 44.9% 5.% 48.% 44.6% 4.4% Net interest margin (average earning assets).89%.95%.00%.08%.0%.5%.5%.9%.4%.98%.7%.%.% Efficiency ratio 49.8% 48.5% 50.6% 49.7% 47.6% 5.6% 5.% 5.6% 5.4% 49.6% 50.9% 54.0% 56.% Operating leverage (4.4)% 8.%.0% 4. % 0.6 % (0.9)% 9.6% 6.5% 4.%.6% 6.5% 4.4% 5.8% Average balances Total assets 4,00 4,700 8,00 5,000 6,700 09,00 04,00 99,600 94,600,00 07,500 87,600 70,00 Total earning assets 4,00 8,00,800 8,00 09,900 0,00 96,800 9,600 87,400 5,00 00,400 80,500 6,00 Loans and acceptances 5,500 8,000 0,600 5,800 09,00 0,600 95,00 90,700 86,700 5,000 99,00 79,000 60,000 Residential mortgages 6,00,600 7,00 4,400 9,900 4,400 0,400 08,000 05,00 9,800,00 00,800 89,700 Personal 46,500 44,600 4,600 4,00 40,00 9,00 8,000 7,000 6,00 4,700 8,700 4,600 0,500 Credit cards,700,400,00,00,700,00,000,000 0,600,400,00 9,900 8,800 Small business,800,700,700,600,500,00,400,400,00,700,400,00,900 Total Retail 98,00 9,00 84,700 80,500 74,400 67,00 6,800 58,400 54,00 88,600 65,500 47,500 0,900 Wholesale 7,00 6,700 5,900 5,00 4,800 4,00,00,00,400 6,400,700,400 9,00 Deposits 59,400 54,900 5,800 5,900 50,00 47,00 45,00 46,00 4,00 55,000 47,00 9,00,500 Attributed capital 7,050 6,900 6,800 6,900 7,50 7,50 7,50 7,050 6,700 6,900 7,00 6,500 6,50 Risk capital 5,50 5,50 4,900 4,900 5,450 5,50 5,00 5,050 4,900 5,050 5,50 4,700 4,00 Credit quality Gross impaired loans / Average net loans and acceptances 0.4% 0.% 0.4% 0.% 0.% 0.% 0.% 0.% 0.% 0.6% 0.5% 0.% 0.% PCL / Average net loans and acceptances 0.8% 0.6% 0.4% 0.9% 0.40% 0.7% 0.4% 0.8% 0.7% 0.9% 0.9% 0.4% 0.4% Net write-offs / Average net loans and acceptances 0.40% 0.40% 0.4% 0.40% 0.9% 0.5% 0.4% 0.6% 0.5% 0.40% 0.8% 0.5% 0.6% Business information Assets under administration 09,500,700 4,00 5,600 0,00 5,600,00 07,600 0,00 09,500 0,00 0,00 80,500 Other earnings measures Net income 676 709 604 67 797 596 566 586 569,66,545,4,85 After-tax effect of amortization of other intangibles 7 7 6 6 Cash Net income 679 70 606 674 799 597 568 588 570,669,55,0,858 Capital charge (87) (8) (75) (8) (94) (9) (86) (87) (77) (76) (758) (685) (646) Economic Profit 49 57 4 49 605 406 8 40 9,94,794,445, Reported results include securitized residential mortgage and credit card loans and related amounts for income and provision for credit losses. The average securitized residential mortgage and credit card loans included as at October, 008 were $ billion and $4 billion, respectively. Securitized residential mortgages and credit card loans are included in Total assets, Total earning assets, Loans and acceptances, Residential mortgage, Credit cards and AUA to better reflect how the assets are managed. Includes income taxes and non-controlling interest in net income of subsidiaries. Includes small business exposure managed on a pooled basis. -8-
WEALTH MANAGEMENT (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Income Statement Net interest income 0 09 06 04 08 0 468 47 97 74 Fee-based revenue 596 599 54 59 58 545 54 50 46,76,09,745,458 Transactional and other revenue 96 0 5 0 9 55 80 8 40,4,456,45,9 Total revenue,05,09 990 95 986,006,008 99 90,987,99,487,5 Provision for credit losses (PCL) - - - - - - - Non-interest expense 860 758 7 688 7 747 7 70 67,08,90,6,440 Business realignment charges - - - - - - - - - - Other 49 74 76 84 74 8 9 79 67 8 7 68 06 Net income 6 86 8 8 80 77 94 64 665 76 604 50 Total Revenue by business Canadian Wealth Management 69 8 59 6 69 69 66 56 4,474,460,90,64 U.S. & International Wealth Management 48 45 490 445 479 49 508 508 448,869,988,7,580 Global Asset Management 7 85 4 45 8 44 4 8 644 544 465 407 Total,05,09 990 95 986,006,008 99 90,987,99,487,5 Financial ratios Return on equity (ROE).%.0% 4.8% 5.5%.7% 9.4% 4.% 4.4% 8.7%.%.4% 7.8% 4.5% Return on risk capital (RORC) 4.8% 69.5% 7.4% 76.7% 6.4% 58.6% 66.4% 7.% 6.0% 64.9% 65.% 59.% 54.8% Average balances Total assets 6,00 7,00 8,00 6,000 7,400 5,700 6,400 6,900 6,000 6,900 6,600 5,00,00 Loans and acceptances 5,900 5,00 4,900 4,600 4,400 4,500 4,700 4,700 4,500 5,00 4,600 4,400 4,00 Deposits 8,00 7,00 6,900 5,00 4,000 4,600 5,800 5,00,00 6,900 4,900,00 0,700 Attributed capital,650,450,00,000,50,50,00,400,00,800,00,50,050 Risk capital,050,050,000 950,50,00,00,50,050,000,50,050 900 Credit quality Gross impaired loans / Average net loans and acceptances 0.0% 0.06% 0.06% 0.07% 0.05% 0.00% 0.00% 0.00% 0.00% 0.0% 0.04% 0.00% 0.00% PCL / Average net loans and acceptances 0.00% 0.08% 0.00% 0.00% 0.09% 0.00% 0.00% 0.00% 0.00% 0.0% 0.0% 0.0% 0.05% Net write-offs / Average net loans and acceptances 0.% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.00% 0.04% 0.00% 0.0% 0.05% Business information Assets under administration Canadian Wealth Management 60,700 79,000 80,600 77,00 8,000 80,900 79,00 74,00 68,600 60,700 8,000 68,600 46,400 U.S. & International Wealth Management 4,400 0,00 00,900 07,400 05,500 4,00 6,600 4,000 07,900 4,400 05,500 07,900 4,00 Total 495,00 509,00 48,500 484,700 488,500 505,00 505,800 508,00 476,500 495,00 488,500 476,500 80,700 Assets under management Canadian Wealth Management,000 4,800,900,00,00,00 0,600 9,00 7,500,000,00 7,500,700 U.S. & International Wealth Management 9,500,500 0,600,00 0,00 0,700 0,700,400 9,700 9,500 0,00 9,700 5,600 Global Asset Management 80,00 97,400 9,00,00 8,800 7,600 7,400 5,700 05,600 80,00 8,800 05,600 90,00 Total,600 4,700 7,800 64,700 6,00 59,600 58,700 57,400 4,800,600 6,00 4,800 8,500 Other earnings measures Net income 6 86 8 8 80 77 94 64 665 76 604 50 After-tax effect of amortization of other intangibles 9 5 4 5 5 6 5 6 5 0 Cash Net income 5 0 86 86 85 8 99 7 69 698 784 64 505 Capital charge (97) (9) (54) (5) (58) (6) (58) (64) (59) (95) (4) (6) () Economic Profit 8 0 7 0 4 5 0 40 54 98 9 (US$ MM) Revenue by business U.S. & International Wealth Management 44 445 488 445 48 46 445 48 40,8,86,5,05 Business information Assets under administration U.S. & International Wealth Management 77,600,500 98,800 06,00,00 0,900 94,00 8,700 74,00 77,600,00 74,00 98,400 Includes income taxes and non-controlling interest in net income of subsidiaries. Q4/08 and 008 Global Asset Management - AUM excludes $.4 billion in assets held by clients of Phillips, Hager & North Investment Management Ltd. for which we earn either a nominal or no management fee. -9-
INSURANCE (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Income Statement Net earned premiums 75 76 689 66 66 660 64 66 656,864,59,595,564 Investment income (697) 49 6 7 0 (97) 64 50 (458) 40 55 540 Fee income 56 48 49 5 49 7 57 64 57 04 97 8 07 Total revenue 858 80 840 887 590 855 860 86,60,9,48, Insurance policyholder benefits, claims and acquisition expense (PBCAE) (86) 55 548 66 67 4 677 56 6,6,7,509,65 Non-interest expense 54 45 4 5 7 7 5 8 4 576 57 57 50 Other (6) 7-7 (9) 4 4 40 0 0 Net income 59 7 04 89 0 0 5 85 06 89 44 0 55 Total Revenue by business Reinsurance & Other 89 0 7 8 6 9 8 09,064 859 744 674 Canadian Life and Health (97) 4 00 55 5 8 4 779,6,7,9 Property & Casualty 8 54 74 6 9 4 59 6 6 67 60 576 55 U.S. Life (9) 5 47 6 77 86 9 4 77 40 596 80 966 Total 858 80 840 887 590 855 860 86,60,9,48, Financial ratios Return on equity (ROE) 0.% 44.6% 4.%.7% 9.% 8.7% 5.% 50.0% 9.9%.8%.% 0.5% 0.8% Return on risk capital (RORC).0% 50.% 8.% 6.0%.%.9% 7.0% 55.7%.4% 7.% 4.7%.8%.% Average balances Total assets,800,600,700,400,00,400,900,700,900,600,500,600 0,900 Attributed capital,50,00,50,00,50,400,400,450,400,50,400,450,400 Risk capital,000,00,00 950,00,50,50,00,50,050,50,50,50 Additional information Premiums and deposits,004,04 898 945 860 889 86 895 864,86,460,406,88 Reinsurance & other 405 45 4 69 7 4 8 8 05,55,5, 964 Canadian life and health 0 07 4 86 85 78 97 7,7,46,069,00 Property & casualty 70 66 55 56 6 54 4 45 5 647 604 57 55 U.S. Life 08 9 94 96 95 6 5 5 9 459 6 770 Insurance policyholder benefits and claims (0) 4 74 47 506 89 54 69 469,09,588,99,0 Insurance policyholder acquisition expense 44 40 74 44 54 5 47 4 60 585 570 5 Insurance claims and policy benefit liabilities 7,85 7,608 7,556 7,558 7,8 7,5 7,864 7,948 7,7 7,85 7,8 7,7 7,7 Fair value changes on investments backing policyholder liabilities (748) (74) (58) 0 78 () 59 (4) (870) (08) 6 Business information Assets under management 400 00 00 00 00 00 00 00 00 400 00 00 00 Other earnings measures Net income 59 7 04 89 0 0 5 85 06 89 44 0 55 After-tax effect of amortization of other intangibles - - - - - - - - - - - - - Cash Net income 59 7 04 89 0 0 5 85 06 89 44 0 55 Capital charge (0) () () (9) (7) (7) (5) (8) (7) () (47) (5) (48) Economic Profit 9 05 7 60 65 66 7 47 69 66 95 49 7 Premium and deposits equals net earned premiums excluding the cost of premiums to other institutions for reinsurance coverage, plus segregated fund deposits. Includes income taxes and non-controlling interest in net income of subsidiaries. Includes revenue impact of the change in fair value on investments backing policyholder liabilities is reflected in Investment income and largely offset in PBCAE. -0-
INTERNATIONAL BANKING (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Income Statement Net interest income 47 47 98 48 9 6 7 57 8,0,0 940 9 Non-interest income 5 66 7 6 59 88 9 77 884 688 654 Total revenue 47 580 564 485 455 5 49 445 49,0,95,68,577 Provision for credit losses (PCL) 98 7 9 7 7 7 0 0 5 497 09 5 49 Non-interest expense 585 485 48 78 6 89 8 48,876,48,6,6 Business realignment charges - - - - - - - - - - - - () Other (05) (6) 7 5 () 9 5 0 (9) 8 6 9 Net income (06) (6) 8 87 67 67 79 (5) - 4 6 56 Total Revenue by business Banking 8 4 49 75 69 0 09 76 74,46,56,070,077 RBC Dexia IS 9 9 5 0 86 0 84 69 55 855 759 558 500 Total 47 580 564 485 455 5 49 445 49,0,95,68,577 Financial ratios Return on equity (ROE) (.4)% (.6)%.0%.5%.% 9.0% 7.4% 8.8%.9% (.4)% 6.9% 0.6% 0.8% Return on risk capital (RORC) (4.9)% (.8)% 6.% 6.4%.8% 5.5%.7% 4.% 7.7% (8.)%.7% 6.% 6.4% Net interest margin (average earning assets) 4.78%.7%.50%.4%.40%.58%.69%.6%.66%.6%.57%.7%.70% Average balances Total assets 65,000 5,600 47,00 40,00 9,400 4,00 4,000 7,500 4,00 5,00 9,700,600 5,900 Total earning assets 4 4,000,400 0,400 5,00 4,800 6,500 7,500 5,800,500,800 6,00,00,600 Loans and acceptances,900 8,000 5,000,000 0,500,800,700,00 9,00 7,000,00 8,500 7,00 Deposits 5,800 4,500 40,700 5,00 4,500 5,00 5,600,800 0,00 4,500 4,00 8,700,00 Attributed capital 7,450 5,600 4,550,50,00,650,500,950,500 5,00,50,400,50 Risk capital,450,00,50,750,900,00,050,800,700,50,950,600,550 Credit quality Gross impaired loans / Average net loans and acceptances 4.76%.98%.67%.7%.08%.05% 0.88% 0.88% 0.97% 5.97%.9%.0% 0.94% PCL / Average net loans and acceptances.%.95%.48%.5%.9% 0.8% 0.7% 0.9% 0.0%.84% 0.49% 0.4% 0.8% Net write-offs / Average net loans and acceptances.94%.% 0.85% 0.0% 0.5% 0.5% 0.7% 0.% 0.0%.6% 0.0% 0.5% 0.% Business information Assets under administration - RBC 5,00 9,400 - - - - - - -,00 - -,6,00 - RBC Dexia IS 6,585,000,80,900,697,000,9,000,7,00,84,400,764,900,666,400,4,00,585,000,7,00,4,00 - Assets under management - RBC 5,900,400 - - - - - - -,900 - - - Other earnings measures Net income (06) (6) 8 87 67 67 79 (5) 4 6 56 After-tax effect of amortization of other intangibles 5 0 9 6 5 4 5 80 57 4 Cash Net income (8) 4 57 47 6 0 8 80 9 (7) 99 04 88 Capital charge (97) (47) (8) (8) (88) (95) (9) (77) (66) (545) (5) (5) (45) Economic Profit (78) (4) (6) (6) (5) 6 (9) 6 (68) (5) 5 4 (US$ MM) Revenue by business Banking 6 8 46 75 68 8 69 9 46,,059 945 887 Includes income taxes and non-controlling interest in net income of subsidiaries. Includes U.S. and Caribbean banking businesses. RBTT Financial Group (RBTT) results are reported on a one-month lag basis. On January, 006, we combined our Institutional & Investor Services (IIS) business with the institutional investor service business of Dexia Banque Internationale à Luxembourg (Dexia), forming a joint venture, RBC Dexia Investor Services (RBC Dexia IS). RBC Dexia IS results are reported on a one-month lag basis. 4 Calculated based on Banking information. 5 AUA and AUM - RBC represent amounts for RBTT as at September 0, 008. AUA - RBC reported in 005 represents AUA for our IIS business. 6 AUA - RBC Dexia IS represents the total AUA of the joint venture as at September 0, 008, of which we have a 50% ownership interest. --
CAPITAL MARKETS (C$ MM) Q4/08 Q/08 Q/08 Q/08 Q4/07 Q/07 Q/07 Q/07 Q4/06 008 007 006 005 Income Statement Net interest income (teb) 648 45 4 8 75 69 56 (7),89 6 557 Non-interest income 54 68 59 84 596 98,0,74,05,096,766 4,005,005 Total revenue (teb),90, 480, 89,58,8,0,008,95 4,89 4,6,56 Provision for (recovery of) credit losses (PCL) 77 0 58 8 () (7) (5) (8) - 8 () (5) (9) Non-interest expense 4 77 546 74 584 69 754 78 644,,769,60,890 Business realignment charges - - - - - - - - () - - () Other 405 7 (7) 66 5 8 04 65 46 50 94 76 Net income 584 69 04 86 60 50 96 00,70,9,55 686 Total Revenue (teb) Total Revenue,90, 480, 89,58,8,0,008,95 4,89 4,6,56 Revenue related to VIEs offset in Non-controlling interest (55) 7 (5) 5 () 8 4 (48) (7) (4) Total revenue excluding VIEs,45,6 495,7 80,45,74,9,004,98 4,58 4,4,586 Total Revenue by business Global Markets 545 60 596 4 609 666 795 60,90,404,55,9 Global Investment Banking and Equity Markets 94 75 9 48 45 47 450 97 6,56,7,47,4 Other 5 8 0 98 70 78 66 8 44 497 5 66 99 Total,90, 480, 89,58,8,0,008,95 4,89 4,6,56 Financial ratios Return on equity (ROE) 4.6% 7.7% 0.7%.9% 5.4% 9.% 8.5%.8 % 7.9 % 0.5% 6.6%.5% 7.5% Return on risk capital (RORC) 40.5% 0.8% 0.8% 9.% 9.% 5.9% 4.4% 9.9 % 4. % 4.5%.5% 8.7%.4% Average balances Total assets 4,800 7,900 5,400 9,00 9,400 7,00 0,00 97,700 74,600 40,00,00 60,600 9,00 Trading securities,600 8,700 4,700 44,800 46,400 54,00 54,900 55,900 7,800 40,00 5,900,00 09,600 Loans and acceptances 4,900 7,900 6,800 6,600,600 8,00 7,800 7,00 4,00 8,00 9,000,00 7,600 Deposits 5,000,00 7,00 7,00,500 4,700 0,400 6,00,00,600 5,700 08,00 96,500 Attributed capital 6,650 5,900 4,800 4,950 4,650 4,800 4,950 4,750 4,00 5,600 4,800 4,50,850 Risk capital 5,650 5,050,900 4,00,750,900 4,00,900,400 4,700,900,450,050 Credit quality Gross impaired loans / Average net loans and acceptances.9% 0.79% 0.84% 0.7% 0.05% 0.07% 0.07% 0.% 0.5%.0% 0.06% 0.8% 0.67% PCL / Average net loans and acceptances 0.7 % 0. % 0.64 % 0.0 % (0.0)% (0.0)% (0.07)% (0.)% 0.00 % 0.48 % (0.08)% (0.5)% (0.5)% Net write-offs / Average net loans and acceptances 0.07 % 0.8 % 0. % (0.0)% (0.0)% (0.0)% (0.06)% (0.)% 0.07 % 0.09 % (0.08)% (0.4)% 0.% Business information Assets under administration 7,500 6,400 7,000 6,900 6,400 6,800 5,400 5,400 4,700 7,500 6,400 4,700,500 Other earnings measures Net income (loss) 584 69 04 86 60 50 96 00,70,9,55 686 After-tax effect of amortization of other intangibles - - - - - - - Cash Net income 584 7 04 86 60 50 97 00,7,9,56 687 Capital charge (75) (57) (4) () () (7) (7) (6) () (587) (50) (447) (407) Economic Profit 409 4 () 7 6 7 89 585 790 909 80 Includes income taxes and non-controlling interest in net income of subsidiaries. Includes Global Credit and Global Research. --