RBC Royal Bank Jamaica (RBCJ) incurred a $690-million loss during the three months to June 30, despite closing four branches on May 1.

But the bank raised more in capital during the quarter, when it issued $905 million worth of ordinary shares.

What’s more, while RBCJ’s losses from October to June totalled $1.3 billion, according to Bank of Jamaica statistics, the commercial bank issued a total of $2.8 billion in shares over the nine-month period.

Its capital base, which stood at $10 billion at the end of June, has been shored up to cover its customer deposits.

The bank is undergoing reorganisation, as part of a two-year plan to return to profitability.

By reducing its branch network to 13, and cutting its staff by 10 per cent, from approximately 700 to 630, it hopes to eliminate underperforming locations, improve cost control and enhance efficiency.

The commercial bank also aims to get more of its clients using online banking, while it plans to send sales teams to companies to appeal to employees by bringing retail banking to them.

For more than four years, RBCJ has been racking up losses, mainly due to bad debt.

“Low or negative growth in most of the countries in the region have contributed to weak overall growth in the banking sector as a result of subdued movements in the loan book, increases in the non-performing category, and resulting downward pressures on profitability,” said RBCJ market head of personal banking Roger Cogle back in January when the branch closures were announced. “As a responsible financial institution we have strengthened our provisions for credit losses as a result of this.”

BOJ statistics and RBCJ’s financial statements revealed that the commercial bank incurred some $7.5 billion in losses over the three-and-a-half years to September 2012. The latest losses would bring that figure closer to $9 billion up to June 30.

Nevertheless, RBCJ’s parent is the largest bank in Canada, by assets and market capitalisation, and its banking system was ranked as the “soundest” by the World Economic Forum for a fifth consecutive year.

Across the Caribbean, RBC’s operations are well capitalised, with a capital base of TT$16.9 billion ($246 billion) and a group capital adequacy ratio of 13.4 per cent — a level that is well in excess of required regulatory thresholds.

“This strong capital base allows us to significantly increase loan loss coverage on impaired loans and advances and to pursue our strategic focus on investment for growth,” said Cogle.