Fitch Ratings has affirmed all of Royal Bank of Canada's
ratings. Additionally, the Long-term Issuer Default Rating, short-term
and individual ratings of RBC Centura Banks, Inc. and its subsidiaries
have been affirmed and removed from Rating Watch Negative. A list of
all ratings follows at the end of this release.
In removing RBC Centura Banks, Inc. (RBCC) from Rating Watch Negative, Fitch recognizes the progress made by the organization since the Rating Watch was assigned in September 2004. Following a substantial restructuring and associated charges in the fourth quarter of 2004, RBCC recorded a loss of US$116 million for 2004 as outlined in its regulatory filings. Since that time, RBCC has exited its mortgage banking operation, which had been a source of a significant portion of the firm's problems and consequently a management distraction. In addition, RBCC has slowed its expansion efforts to focus on improving the efficiency and profitability of its existing franchise. Fitch views the steps that the company has taken thus far in the U.S. to be appropriate, and the company appears to be on the right track to show an improved performance. While Fitch expects 2006 to be a year of digestion and rationalization, it is likely that RBCC will resume its expansion plans in the southeast in the intermediate term.
RBCC rebounded from the 2004 loss, posting earnings of US$92 million in 2005. Profitability levels, while clearly improving, remain weak in comparison to many peers. This is somewhat mitigated by the firm's strong capitalization, solid funding and good asset quality. RBCC's long-term ratings reflect the strength of its parent, The Royal Bank of Canada, which is the largest Canadian bank.
Fitch affirms the following ratings; the Rating Outlook is Stable:
Royal Bank of Canada
-- Long-term Issuer Default Rating (IDR) at 'AA';
-- Senior unsecured at 'AA';
-- Subordinated debt at 'AA-';
-- Commercial paper at 'F1+';
-- Short-term rating at 'F1+';
-- Individual rating at 'A/B';
-- Support at '1'.
Fitch affirms the following ratings and removes them from Rating Watch Negative; the Rating Outlook is Stable:
RBC Centura Banks, Inc.
-- Long-term IDR at 'AA-';
-- Short Term Rating at 'F1+';
-- Individual Rating at 'B';
-- Support at '1'.
RBC Centura Bank
-- Long-term IDR at 'AA-';
-- Long-term Deposits at 'AA';
-- Short Term Deposits at 'F1+';
-- Short Term Rating at 'F1+';
-- Individual Rating at 'B';
-- Support at '1'.
RBC Centura Capital Trust I
-- Trust Preferred Securities at 'A+'.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.
In removing RBC Centura Banks, Inc. (RBCC) from Rating Watch Negative, Fitch recognizes the progress made by the organization since the Rating Watch was assigned in September 2004. Following a substantial restructuring and associated charges in the fourth quarter of 2004, RBCC recorded a loss of US$116 million for 2004 as outlined in its regulatory filings. Since that time, RBCC has exited its mortgage banking operation, which had been a source of a significant portion of the firm's problems and consequently a management distraction. In addition, RBCC has slowed its expansion efforts to focus on improving the efficiency and profitability of its existing franchise. Fitch views the steps that the company has taken thus far in the U.S. to be appropriate, and the company appears to be on the right track to show an improved performance. While Fitch expects 2006 to be a year of digestion and rationalization, it is likely that RBCC will resume its expansion plans in the southeast in the intermediate term.
RBCC rebounded from the 2004 loss, posting earnings of US$92 million in 2005. Profitability levels, while clearly improving, remain weak in comparison to many peers. This is somewhat mitigated by the firm's strong capitalization, solid funding and good asset quality. RBCC's long-term ratings reflect the strength of its parent, The Royal Bank of Canada, which is the largest Canadian bank.
Fitch affirms the following ratings; the Rating Outlook is Stable:
Royal Bank of Canada
-- Long-term Issuer Default Rating (IDR) at 'AA';
-- Senior unsecured at 'AA';
-- Subordinated debt at 'AA-';
-- Commercial paper at 'F1+';
-- Short-term rating at 'F1+';
-- Individual rating at 'A/B';
-- Support at '1'.
Fitch affirms the following ratings and removes them from Rating Watch Negative; the Rating Outlook is Stable:
RBC Centura Banks, Inc.
-- Long-term IDR at 'AA-';
-- Short Term Rating at 'F1+';
-- Individual Rating at 'B';
-- Support at '1'.
RBC Centura Bank
-- Long-term IDR at 'AA-';
-- Long-term Deposits at 'AA';
-- Short Term Deposits at 'F1+';
-- Short Term Rating at 'F1+';
-- Individual Rating at 'B';
-- Support at '1'.
RBC Centura Capital Trust I
-- Trust Preferred Securities at 'A+'.
Fitch's rating definitions and the terms of use of such ratings are available on the agency's public site, www.fitchratings.com. Published ratings, criteria and methodologies are available from this site, at all times. Fitch's code of conduct, confidentiality, conflicts of interest, affiliate firewall, compliance and other relevant policies and procedures are also available from the 'Code of Conduct' section of this site.