RBC lifts CET1 ratio by 80bp with model parameter update
Reclassification of small business clients carves out C$26 billion of credit risk
Royal Bank of Canada (RBC) amped up its Common Equity Tier 1 (CET1) ratio by 80 basis points to 13.6% in the three months to the end of July, after a change in the way the bank treats small business clients drove a reduction in risk-weighted assets (RWAs).
The bank carved out C$26 billion ($21 billion) from credit risk exposures with model parameter updates, which increased the threshold for determining which small business clients are subject to retail capital treatment.
RBC’s total credit
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