TORONTO, Canada — Royal Bank of Canada (RBC), parent company of RBTT Bank Jamaica, has reported record net income of CDN$1.8 billion for the first quarter ended January 31, 2011, up CDN $342 million or 23 per cent from last year and up CDN$718 million or 64 per cent from last quarter.

RBC, in a press release on Friday, said earnings were driven by record results in its Canadian Banking, Capital Markets and Wealth Management segments.

“We grew our earnings across our segments demonstrating the strength and diversification of our businesses and the earnings power of this organisation,” said RBC president and CEO Gordon Nixon.

“Through 2011, we plan to extend our leadership positions in Canada and build on our global platforms by focusing on clients’ needs and capitalising on the global economic recovery,” said Nixon.

Canadian Banking net income was CDN$882 million, up CDN$105 million or 14 per cent from last year, reflecting solid volume growth across all businesses and lower provision for credit losses (PCL), partially offset by increased staff costs, including higher pension expenses. Compared to last quarter, net income was up CDN$117 million or 15 per cent, driven by volume growth across all businesses, lower PCL and lower marketing costs.

“Our record earnings in Canadian Banking reflect our leadership and proven ability to outperform in the marketplace. Our size and scale gives us enormous potential to drive efficiencies while reinvesting in our businesses to generate top-line growth,” Nixon said.

Wealth Management net income was CDN$221 million, up CDN$2 million over last year and up CDN$46 million from last quarter, driven by higher average fee-based client assets, increased transaction volumes and a favourable cumulative accounting adjustment of CDN$15 million (CDN$11 million after-tax) related to the firm’s deferred compensation liability. Last year included a favourable accounting impact related to the foreign currency translation on certain available-for-sale (AFS) securities of CDN$39 million (CDN$34 million after-tax) and a favourable income tax adjustment of CDN$30 million.

“Our continued growth in Canada and expanding presence in the US and select international markets allowed us to capitalise on the recovery of global equity markets. As a global leader in wealth and asset management, we are well positioned to leverage our strong positions and continue to grow this attractive business,” Nixon said.

Insurance net income was CDN$145 million, up CDN$27 million or 23 per cent from a year ago, largely reflecting lower reinsurance and disability claims costs and favourable life policyholder experience, partially offset by net investment losses in the current quarter. Compared to last quarter, net income was up CDN$2 million excluding the loss on Liberty Life.

“Insurance contributed another solid quarter to our diversified earnings stream. We are growing market share by continually innovating and tailoring products to better suit customer needs,” Nixon said.

The firm’s International Banking segment reported net income was CDN$24 million as compared to a net loss of CDN$57 million in the prior year, largely reflecting losses on AFS securities last year and lower PCL in the current quarter as credit quality improved, RBC said. Compared to last quarter, net income was up CDN$181 million mainly due to lower PCL in Caribbean and US banking, lower losses on foreclosed assets in US banking and losses on AFS securities in the prior quarter.

“In International Banking, credit quality improved across our banking businesses and we saw some positive signs of underlying business growth. However, sustained profitability of this segment is contingent on the continued improvement in credit quality and the pace of recovery of the US and Caribbean economies,” Nixon said.

Capital Markets net income was CDN$613 million, up CDN$42 million, or seven per cent from a year ago largely due to strong growth in RBC’s origination business, particularly in debt mandates, driven by stronger new issue activity and higher loan syndication fees.