RBC Financial Group reported net income of $4.2 billion for all operations for the second quarter of 2022, which ran from February 1 to April 30. This result is up 5.9 per cent or $238 million from the $4 billion in net income reported in Q2 2021. 

“Our earnings reflect higher results in Personal & Commercial Banking, Corporate Support, Insurance and Investor & Treasury Services, partially offset by lower results in Capital Markets and Wealth Management,” says the financial institution. 

Wealth management 

For its Wealth Management business, RBC reported net income of $750 million in the second quarter of 2022, up from $683 million in Q2 2021. The increase of 9.8 per cent or $67 million is “primarily due to higher average fee-based client assets reflecting net sales and market appreciation. Higher net interest income driven by average volume growth also contributed to the increase,” RBC says. 

“These factors were partially offset by higher variable compensation, higher staff-related costs, as well as lower transactional revenue,” the institution adds. 

Insurance 

For its insurance segment, RBC reported net income of $206 million in the second quarter of 2022, versus $187 million in Q2 2021. This increase of 10.2 per cent or $19 million is “primarily due to higher favourable investment-related experience.” 

Insurance income 

RBC's insurance revenue was $234 million in Q2 2022, compared with $536 million in Q2 2021, for a decline of 56.3 per cent or $302 million. 

Looking at the results in closer detail, RBC reported insurance losses in Canada of $507 million in the second quarter of 2022, compared with $172 million in Q2 2021. RBC says this $335 million plunge is “mainly due to the change in fair value of investments backing policyholder liabilities, which is largely offset in policyholder benefits, claims and acquisition expense (PBCAE) as indicated below.”

“This was partially offset by higher group annuity sales and business growth across most products," RBC adds. 

International insurance revenue rose to $741 million in Q2 2022, from $708 million in Q2 2021. This increase of 4.7 per cent or $33 million is “primarily due to business growth in longevity reinsurance.” 

PBCAE 

Insurance policyholder benefits, claims and acquisition expense declined by $329 million, “primarily reflecting the change in fair value of investments backing policyholder liabilities, which is largely offset in revenue. Higher favourable investment-related experience also contributed to the decrease.”

RBC adds that “these factors were partially offset by higher group annuity sales and business growth.” 

Premiums and deposits 

RBC's insurance premiums and deposits were $1.5 billion in the second quarter of 2022, compared with $1.2 billion in Q2 2021. They thus climbed 25.6 per cent or $297 million. 

Looking at the results in closer detail, premiums and deposits in Canada were $824 million in Q2 2022, versus $559 million in Q2 2021. This represents an increase of 47.4 per cent or $265 million. 

International premiums and deposits were $634 million in Q2 2022, compared with $602 million in Q2 2021. This increase amounts to 5.3 per cent or $32 million.