Royal Bank of Canada today reported a 19% in third quarter profit driven by strong results in Canadian banking, capital markets and wealth management.

The bank also raised its dividend by 9%, to 50¢ a share.

The bank said it earned $1.395 billion, or $1.06 a share, in the three months ended July 31. That compared to profit of $1.18 billion, or 90¢ a share, a year earlier.

On a cash basis, which excludes the amortization of intangibles, the bank earned $1.08 a share, up from 91¢ in the 2006 period.

Return on equity was 24.4% in the latest quarter, up from 23.1% a year ago.

Loan loss provisions rose to $178 million, from $99 million a year ago, but were down from provisions in the previous quarter.

In the Canadian banking segment, which includes global insurance results, Royal Bank said net income climbed 6% to $699 million.

Its global insurance net income rose, despite a decline in revenue, due to favorable disability claims experience.

U.S. & international banking net income increased 6% from last year as a result of strong revenue growth in RBC Dexia Investor Services (IS), coupled with the expansion of banking in the U.S. Southeast.

Capital markets profit rose 19% to $360 million, while the bank’s wealth management unit saw profit increase 30% to $177 million.

Commenting on the results, Gordon Nixon, president & CEO, stated, “I am very pleased with the results this quarter across all of our business segments. We continued to extend our leadership position in Canada and expanded on our strengths in the U.S. and internationally, while delivering top quartile returns to our shareholders.”

Commenting on the global volatility in credit markets, Nixon added, “We do not originate U.S. subprime loans, and have minimal exposure to U.S. subprime residential mortgage-backed securities and collateralized debt obligations. Our underwriting commitments to LBOs are minimal, as is our exposure to hedge funds. Finally, we have nominal exposure to Canadian non-bank sponsored ABCP conduits with general market disruption liquidity facilities, which is the market segment that has been experiencing illiquidity recently. None of this paper is held in RBC Asset Management or in any of RBC’s private client accounts.”