The Canadian Press

Royal Bank of Canada (TSX:RY) saw its net income rise 10% in the fourth quarter on strong performance from Canadian banking, capital markets, wealth management and insurance, which offset losses in its international operations.

Toronto-based RBC, Canada’s biggest bank, reported net income of $1.2 billion for the quarter ended Oct. 31. That was up from $1.1 billion a year ago.

Revenues for the quarter totalled $7.5 billion, up from $5.1 billion last year.

Diluted net earnings per share were 82¢ for the quarter, compared to 81¢ in last year’s fourth quarter.

Provisions for credit losses, or PCL, rose to $883 million, up from $619 million in the fourth quarter of fiscal 2008.

The increased provisions for bad loans was due in part to credit issues in its U.S. banking business, where consumers struggled to repay debt in a recessionary environment.

RBC’s international operations produced a net loss of $125 million. This was however an improvement from a loss of $206 million a year ago.

The bank said the quarter’s loss in international banking reflected elevated provisions for credit losses due to a weak economic environment, and a provision related to the restructuring of certain Caribbean banking mutual funds.

Gordon Nixon, RBC’s president and chief executive officer, said the bank is “working hard to address the challenges in our U.S. banking operations” but said Royal remains strong and well-positioned when the environment improves.

“RBC stands apart as a globally significant, strong and stable institution at the end of a very challenging year,” Nixon said.

“Our results through 2009 underscore the value of our diversified business model, ongoing cost discipline and client first approach to doing business.”

For fiscal 2009, RBC recorded revenue of $29.1 billion, up from $21.6 billion in the previous year.

Annual net income was $3.9 billion, down from $4.6 billion in 2008.

RBC shares closed at $57.48 Thursday on the Toronto Stock Exchange.

RBC said its Capital Markets business delivered strong results in the quarter recording net income of $561 million. While this was down $23 million from a year ago, the bank noted that 2008 figures had included the favourable impact of the reduction of the Enron-related litigation provision of $542 million.

RBC said its capital markets sector had stronger trading results and market-related gains of $31 million, compared to losses of $217 million last year. These factors were however partially offset by higher variable compensation commensurate with strong results and higher provision credit losses.

The bank added that its wealth management businesses benefited from more favourable market conditions during the quarter which allowed it to post net income of $161 million, a 39% increase from last year.

RBC’s insurance sector had net income of $104 million for the quarter, up $45 million from 2008 figures, reflecting investment losses in the previous year and solid business growth.

“Insurance remains a strong contributor to our diversified earnings stream by offering a full suite of solutions for our clients,” Nixon said.