Royal Bank Of Canada (RY) Financials

Analyzing Royal Bank of Canada's balance sheets over the past three years, from fiscal year 2022 through fiscal year 2024, reveals several key trends and changes that retail investors should note.

• Total Assets Growth: Total assets increased from approximately $1.41 trillion in 2022 to about $1.56 trillion in 2024, reflecting steady asset growth of over 10% across the period.
• Increase in Loans and Leases: Net loans and leases grew significantly from around $601 billion in 2022 to $704 billion in 2024, showing strong loan portfolio expansion which can be a positive indicator of business growth.
• Growth in Common Equity: Common equity rose from about $73.9 billion in 2022 to $91.2 billion in 2024, indicating strengthened capital position and potential for increased shareholder value.
• Goodwill and Intangible Assets Increase: Goodwill grew from about $9 billion to roughly $13.8 billion, and intangible assets also increased, which may reflect acquisitions or investments in intangible assets that could enhance future earnings.
• Fluctuation in Cash and Due from Banks: Cash and due from banks fluctuated, decreasing from $53 billion in 2022 to about $40.7 billion in 2024, which may reflect changes in liquidity management.
• Other Assets Increased: Other assets rose notably, from $172 billion in 2022 to $66 billion in 2024 — likely a major decrease caused by restatements or reclassifications; the large differences suggest segmented changes that require further detail for proper analysis.
• Increase in Total Liabilities: Total liabilities increased sharply from around $707 billion in 2022 to approximately $1.47 trillion in 2024, primarily driven by rises in deposits and federal funds purchased, indicating heavier reliance on borrowings and deposits which may impact financial risk.
• Sharp Increase in Federal Funds Purchased and Securities Sold: This liability jumped significantly from $0 (not shown in 2022) to over $219 billion in 2024, potentially signaling increased short-term borrowing or liquidity pressures.
• Decrease in Restricted Cash: Restricted cash dropped drastically from about $246 billion in 2022 to just $25 million in 2024, which could reflect changes in regulatory cash reserves or asset reclassification needing further examination.
• Short-Term Debt and Bankers Acceptances: These liabilities have remained relatively stable, showing minor fluctuations, indicating consistent short-term financing strategies.

Summary: Overall, Royal Bank of Canada’s balance sheet shows growth in key areas like loans, assets, and equity, reflecting business expansion and capital strengthening. However, the large increase in liabilities, especially short-term borrowings and federal funds purchased, along with major changes in restricted cash, suggest areas that investors should watch closely for liquidity and risk management. The rise in intangible assets and goodwill further points to strategic investments, potentially through acquisitions. Investors should consider these factors within the broader context of market conditions and company strategy.