RBC

A jump in provisions dragged down the Royal Bank of Canada's profits last quarter, prompted by the bank's fears of a potential tariff-driven recession.

As the Canadian economy weakens in the face of US tariff uncertainty, Royal Bank of Canada and other large banks north of the border are putting aside more money for loans that are still in good standing.

Royal Bank of Canada executives said they plan to start originating more mortgages in the United States, and they indicated that they may ditch the City National Bank brand.

Canada's largest bank is bracing for the impact of a threatened U.S. 25% tariff on imports from north of the border. But the cloudy 2025 outlook was offset by strong results last quarter.

The Los Angeles-based subsidiary of Royal Bank of Canada posted its strongest performance in six quarters.

Canadian Imperial Bank of Commerce and Royal Bank of Canada both set aside much less money than expected last quarter to cover loan losses.

The top executive at Royal Bank of Canada expressed reluctance about expanding south of the border again, citing what he characterized as a changing regulatory landscape and pointing to lessons learned from the 2015 acquisition of City National Bank.

Nadine Ahn was terminated on April 5 along with fellow exec Ken Mason after the bank received an anonymous tip that the two were romantically involved. Both deny it and are suing the bank for millions.

The Toronto-based bank has spent the last two years gathering client input and building a platform for customers to manage the flow of payments and receivables, pay taxes in the most efficient jurisdictions, balance currency risks and more.

As he updated RBC shareholders on a disappointing quarter, CEO Dave McKay cited the U.S. banking crisis and gridlock over the debt ceiling.