Royal Bank of Canada is reporting record profit for the fourth quarter ended October 31.

The bank says the increase is driven by stronger results from its investment and insurance units.

Net profit for the quarter was $746 million, up $80 million or 12% from a year ago, and diluted earnings per share were $1.11, up 16¢ or 17%, under Canadian generally accepted accounting principles,

Return on equity was 18.0% compared to 16.3% a year ago. A 16% appreciation of the Canadian dollar relative to the U.S. dollar from the fourth quarter of 2002 resulted in a lower translated value of U.S. dollar-denominated earnings, reducing net income by approximately $20 million.

Net income for the year ended October 31, was $3,036 million, up $138 million or 5% from 2002, using U.S. generally accepted accounting principles. The stronger Canadian dollar relative to the U.S. dollar reduced net income by $60 million.

Commenting on the results, Gordon Nixon, president and CEO, said, “We are pleased with our record net income in 2003 of $3.04 billion, and also with the record earnings in the fourth quarter, which reflect our business diversification and strong results from RBC Capital Markets, RBC Investments and RBC Insurance.”

Total revenues were down $17 million from a year ago as a $200 million decline in the translated value of U.S. dollar-denominated revenues this quarter due to the appreciation of the Canadian dollar relative to the

The decline in the U.S. dollar more than offset the benefits of higher consumer loan volumes and capital markets-related revenues.

The specific provision for credit losses was $140 million or 0.26% of average loans, acceptances and reverse repurchase agreements, down from $235 million or 0.43% a year ago.

At October 31, 2003, the banks Tier 1 capital ratio was 9.7% and the Total capital ratio was 12.8%, compared to 9.3% and 12.7%, respectively, one year ago.