Royal Bank of Canada at National Bank Financial Services Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : What does that involve the new responsibility. And I guess there have been a lot of, let's say, changes at CNB taking place over the past year plus. What are the key strategic directions you're heading in with City National. So what does the role evolve? And then where are you going with it?

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : Just a quick one because of -- you talked about the 3 pillars of the U.S. business. In City National, I don't -- I'm probably the description I'm probably going to but you here, but there's some extra attention from the compliance and regulation and all that stuff. That -- those -- that extra attention doesn't apply to the rest of the capital markets or the wealth operation, like RBC Bank U.S.A., whatever the holding company would be. It's just isolated to CNB?

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : And in that vein, when you're thinking about how you're managing your enterprise, I think you were Schedule 3 in the U.S.? Do you pretend like your Schedule 1 just to make sure that your standards are the highest in the industry, so to speak?

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : Question on the Capital Markets business because we did have a lot of disruption in the market last year and it's, I guess, calmed down a bit. But if I go back, way back to the financial crisis, one of the big moves that RBC Capital Markets did was take advantage of these opportunities. European banks were in severe stress and you're able to hire away teams and build the franchise out organically. Has anything similar taking place over the past year? Or is it just steady as she goes pretty much?

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : Right. And then you did touch upon the corporate lending business and another page of RBC Capital Markets history was subsequent to your expansion hiring teams, the corporate loan book did indeed grow, but you hit a point where, well, you have to debank customers because they weren't paying off as much as you anticipated, that's behind us. I'm wondering, is there a balance sheet to optimization as a buzzword that we're hearing from many banks these days. It doesn't seem like there's a big change in the corporate loan book, not at RBC. I'm wondering if there's other aspects of this broader theme that might be applicable in your business or evident?

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : And let's maybe dive into more of a specific business. It's topical from time to time, the high yield, and I'll use my term, high yield, you might use a different term, but there's the origination to distribute part of it, and then there's the actual lending balance sheet business that's levered finance, I believe you call it. What's -- anything to update there? I know the market has been fairly (inaudible) the past couple of years?

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : And then, I mean, that brings up the famous pipeline type of question here. Converting the pipeline to actual revenue growth, what do we need to see in the market?

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : A little twist, I don't know, in terms of the growth outlook. Private credit is getting a whole lot more attention lately. Lots of dry powder in that marketplace. I'm wondering is this, I'd say, threat or opportunity. But how are you approaching this -- these players and trying to take advantage of potentially some new opportunities presenting them to themselves.

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : I want to talk about another hot button issue here at commercial real estate. I know it's kind of spread all over the bank. But what's the exposure in the capital markets business. And I haven't really seen any charts, I guess, that illustrate how many of the maturities have already are in the rearview mirror. Like what's the refinancing outlook for what's in your business?

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : Another business I wanted to talk about and maybe wrap up on that one is energy banking. Historically, a very important one and still is today. A couple questions about it. Is the traditional client base still a growth driver for the bank. The transition economy, that was the buzzword that was thrown around a lot in the past few years. Is it meeting your expectations as far as delivering revenues to the bank? And then how often is it playing to your decision-making that some investors, and I'm not signaling Royal out in this sense, but since you're here, I'll ask you, they won't invest in a Canadian bank because they have some green mandates, particularly European investors. How does that play into your decision making that challenge?

Question: Gabriel Dechaine - National Bank Financial, Inc., Research Division - Analyst : Well, and that's a nice way to wrap things up. Derek, enjoy the rest of your day. Thank you for coming to Montreal.