Royal Bank of Canada (NYSE:RY) in the fourth quarter FY 16 has reported a 2% fall in the net income to $2.54 billion, down from $2.59 billion a year ago. The earnings was down 12% from the last quarter due to lower earnings in Capital Markets and Personal & Commercial Banking even though the bank benefited from a lower effective tax rate which were partially offset by strong earnings in Insurance and Investor & Treasury Services, and higher earnings in Wealth Management. The diluted earnings per share amounted to $1.65, down from $1.74 in Q4 FY 15 and missed the analyst’s expectation of $1.71. Royal Bank of Canada revenue for the fourth quarter was $9.27 billion, as compared with $8.02 billion during the same period last year. The bank has also reported $358 million in provisions for credit losses, up from $318 during the previous quarter, primarily due to low oil prices. On the other hand, as at October 31st, 2016, Basel III CET1 ratio is 10.8%, up 30 bps as compared to last quarter largely due to the internal capital generation.

Additionally, Royal Bank of Canada in FY 16 has reported a 4% growth in the net income to $10,458 million driven by strong results in Wealth Management, which includes the City National Bank (City National), and higher earnings in Insurance. Q3/16 gain on the sale of the home and auto insurance manufacturing business also drove the performance. In addition, the solid results in Personal & Commercial Banking and record earnings in Investor & Treasury Services have also contributed to the growth. Although, these factors are partially offset by lower earnings in Capital Markets. Royal Bank of Canada’s performance has also benefited from the ongoing efficiency management activities. Moreover, the provision for credit losses (PCL) ratio of 0.29% was up 5 basis points (bps) primarily as a result of the low oil price environment.

Royal Bank of Canada has declared a quarterly share dividend of 83 cents per share, which is payable on and after February 24th, 2017, to common shareholders of record at the close of business on January 26th, 2017. Moreover, RY has declared a dividends for the Non-Cumulative First Preferred Shares, payable on and after February 24th, 2017, to shareholders of record at the close of business on January 26th, 2017.

Royal Bank of Canada stock has risen 23.8% in this year to date (as of Nov 30; Source: Google Finance). According to tipranks.com, RY has an average price target of $59, which is a further downside of 12.01%.