Royal Bank of Canada (RBC) reported a 7 percent year-over-year increase in revenue for its U.S. wealth management division, driven by net asset inflows and rising market values. For the first quarter of its fiscal year, which runs from November through January, RBC Wealth Management U.S. generated $1.7 billion in revenue. According to Financial Planning, the firm saw $5.2 billion in net new assets, boosting total assets under management by 17 percent to $228 billion. Assets under administration also climbed 16 percent to $695 billion.

Despite the revenue increase, expenses for RBC's U.S. wealth business remained steady at $1.5 billion. As reported by Financial Planning, the division posted a net income of $211 million, a 56 percent jump from the prior year, largely due to the absence of a $159 million special assessment paid to the Federal Deposit Insurance Corporation (FDIC) in the same period last year. RBC also reported an efficiency ratio  —expenses as a percentage of revenue — of 87.7 percent, a 6.2 percentage-point improvement year over year.

RBC's overall wealth management revenue, which includes its U.S., Canadian, and international businesses, rose 19 percent year over year to nearly CA$5.6 billion. Expenses increased by 9 percent to CA$4.2 billion, primarily due to higher variable compensation and staffing costs. The bank also recorded a $70 million charge for potential loan losses, some of which were attributed to the impact of California wildfires.

Firmwide, RBC's wealth management units reported CA$980 million in net income, a 48 percent increase. The firm's assets under management grew 24 percent year over year to CA$1.4 trillion, while assets under administration rose 14 percent to CA$4.9 trillion. RBC ended the first quarter with 6,180 advisors, a modest increase from the 6,125 advisors reported a year earlier.

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