Good morning, ladies and gentlemen. Welcome to RBC's conference call for the second quarter 2021 financial results. Please be advised that this call is being recorded. I would like to turn the meeting over to Nadine Ahn, Head of Investor Relations. Please go ahead, Ms. Ahn. Thank you, and good morning, everyone. Speaking today will be Dave McKay, President and Chief Executive Officer, Rod Bolger, Chief Financial Officer, and Graeme Hepworth, Chief Risk Officer. Also joining us today for your questions, Neil McLaughlin, Group Head Personal and Commercial Banking, Doug Guzman, Group Head Wealth Management, Insurance, and I&TS, and Derek Neldner, Group Head Capital Markets. As noted on slide one, our comments may contain forward-looking statements, which involve assumptions and have inherent risks and uncertainties. Actual results could differ materially. I would also remind listeners that the bank assesses its performance on a reported and adjusted basis and considers both to be useful in assessing underlying business performance. To give everyone a chance to ask questions, we ask that you limit your questions and then re-queue. With that, I'll turn it over to Dave. Thank you, Nadine. Good morning, everybody. Thank you for joining us in our Q2 call. Today, we reported earnings of CAD 4 billion, driven by strong client activity across our businesses. Our results reflect market share gains in Canadian banking and wealth management, as well as record investment banking and equities performance in Capital Markets. Even with heightened client activity, we leveraged our scale, past investments, and disciplined approach to cost management to drive positive operating leverage. Pre-provision, pre-tax earnings increased 11% year-over-year, despite absorbing approximately CAD 450 million of headwinds related to lower interest rates and a stronger Canadian dollar. Although uncertainty remains, credit and market risk indicators are relatively benign when compared to the start of the pandemic. Our portfolios have performed exceptionally well through the cycle, with very low PCL on impaired loans. We are confident that a wide range of strategic initiatives will enable us to continue growing our balance sheet well within our current risk appetite. We remain very well capitalized with a CET1 ratio of 12.8%. In addition, next quarter, we expect the implementation of parameter updates, net of other items, to add 55-70 basis points to our capital ratios, pushing our CET1 ratio to well above 13%. Even with these elevated capital levels, we generated a premium ROE of 19% for the first half of 2021. We will continue to leverage the strength of our balance sheet and recurring internal capital generation to further accelerate organic growth across our businesses. In addition, when regulatory restrictions are lifted, we will look to accelerate capital return to our shareholders through a mix of share buybacks and higher dividends, given our payout ratio is currently at the bottom end of our 40%-50% range. Highlighting our organic value creation, our book value per share grew 8% from last year, with tangible book value per share up over 11%. I will now speak to how we see the macro environment unfolding. While we are in the early stages of an economic recovery, there is still uncertainty about the risk posed by new variants and stresses in supply chains. The time horizon for how the recovery will evolve continues to be correlated to the success of the vaccination rollout. It remains uncertain when international borders will fully reopen. Although there is still work to be done to open up all parts of the economy, we are encouraged by the progress so far. As vaccine distribution gains momentum, we anticipate an acceleration of economic activity alongside easing virus containment measures. Until then, fiscal and monetary stimulus remains in place to bridge the gap and stimulate the recovery. However, the combination of these actions and supply shortages is increasing the risk of inflation in certain asset classes. Consequently, there is a higher likelihood of central banks raising their benchmark interest rates in the second half of 2022. With respect to Canadian housing, we continue to monitor supply-demand imbalances across Canada, and we support recent actions taken by regulators to adjust mortgage stress tests to take some pressure off the demand side of the equation. We encourage policymakers to also address the problems of limited supply, which are exacerbating house price inflation. As always, we manage risks through a cycle, and the credit metrics of our most recent mortgage originations remain strong and are consistent with our existing high-quality portfolio. I will speak to a number of drivers that position us for strong performance going forward, starting with two Canadian Banking businesses that are poised to rebound. I will highlight the embedded profit growth in our core deposit and U.S. wealth management franchises, followed by a number of initiatives we have to accelerate organic growth. I will start by commenting on our credit card and commercial banking businesses, which have disproportionately been impacted by suppressed economic activity. Over the last 12 months, total revenue associated with our credit card business was down approximately CAD 400 million year-over-year, largely due to lower net interest income as utilization rates fell 300 basis points. A stimulative macro backdrop sets the stage for higher-yielding card balances and purchase volumes to recover alongside economic activity. This relationship is one that is highly correlated, and we are confident that it will hold coming out of the pandemic. As a result, we expect that our leading credit card franchise will see total revenue rebound towards pre-pandemic levels. Business lending activity has also been restrained, even though we have added CAD 60 billion of business deposits over the last two years. Commercial banking utilization rates on operating lines have fallen below pre-pandemic levels. However, we do expect to see commercial activity resume over the coming quarters, fueled by client investments in inventory and receivable growth and rising utilization rates. In addition, we have two businesses which are better positioned than most to benefit from rising interest rates. Our strong growth in personal core deposits in Canadian Banking has increased our sensitivity to higher interest rates and will drive outsized revenue growth in a rising rate environment. U.S. wealth management is also well-positioned to benefit from rising interest rates, given the asset-sensitive nature of City National Bank's balance sheet, combined with nearly $40 billion of sweep deposits. I will now speak to the second pillar of future performance. Our investment in technology goes well beyond just adding digital functionalities. These investments have helped create differentiated digital businesses and additional client touchpoints, accelerating cross-sell of existing clients and new client acquisition. We expect to see accelerated client growth through MyAdvisor, InvestEase, Insight Edge, NOMI, RBC Ventures, and Aiden, which have been in the market for a number of years now. We made early and continuous investments in our distribution network and client-facing talent, including mortgage specialists, commercial account managers, and investment advisors. The combination of these investments over a number of years is driving better outcomes for our clients, strong volume growth, deeper client relationships, and increasing scale and profitability. We are proud to note that RBC has yet again been ranked number one in overall customer satisfaction among the Big Five retail banks by JD Power. Specifically, Canadian banking added over CAD 55 billion in mortgages, CAD 45 billion in personal deposits, and increased AUA by over CAD 50 billion over the last two years, leading to market share gains in these anchor products. Our long-term strategy to grow our core deposit business and provide exceptional service and advice is a core driver of our differentiability in building deeper relationships. The result is roughly 65% of our Canadian banking clients have more than just a transaction account with us, many of which also end up getting a credit card, a mutual fund, or a mortgage. Our mortgage relationships have higher retention rates for these multi-product clients, with mortgage profitability up roughly two times higher when a client is retained for a second term. Going forward, we're also excited about the potential of two new strategies to further accelerate client acquisition and growth in Canadian banking. We recently announced the national launch of RBC Vantage, a new everyday Canadian banking offering that brings together a comprehensive suite of powerful benefits for RBC clients, incentivizing even deeper client relationships. Our new offering gives clients the ability to use their debit cards to earn RBC Rewards, save on monthly account fees, and earn more rewards and savings when they take advantage of partner offers. We launched our exclusive multi-year strategic partnership with the Royal College of Physicians and Surgeons of Canada to support the unique needs of Canada's medical specialists. Furthermore, 45% of our Canadian high-net-worth retail client base has a relationship with both Canadian banking and Canadian wealth management. We expect this ratio to increase over time as more of our clients shift surplus deposits into investment products, further accelerating the growth trajectory. Moving now to wealth management, where we've added to our leading scale by investing and hiring experienced investment advisors and technology investment capabilities to meet our clients' evolving needs. In this quarter, RBC Global Asset Management posted its strongest quarterly long-term mutual fund net sales performance ever and has increased its assets under management by over CAD 100 billion over the last two years. Furthermore, Canadian Wealth Management AUA has increased more than CAD 80 billion over the last two years. We expect to similarly benefit from trends in U.S. wealth management, where our past investments have included strong advisor recruiting. This quarter alone, we added a further CAD 4 billion of assets under administration by hiring more experienced advisor teams. This is on top of the $22 billion added over the prior eight quarters. These seasoned advisors are attracted by our client-first culture, coupled with the capabilities and resources of a large bank, including an integrated technology platform. We also expect the strong loan growth in City National to continue as the U.S. economy opens up, leveraging past investments to add private and commercial bankers and expansion to new markets, including our office in Hudson Yards in New York City. Growth will be further accelerated by the recent launch of City National's new national corporate banking division, which specializes in meeting the complex needs of larger commercial and mid-sized companies across the United States. As you've seen in the last five quarters, we have benefited from the strong earnings provided by our Capital Markets business, which has delivered consecutive quarters of record results. Over half of RBC Capital Markets revenue is earned out of the United States and will continue to benefit from an improving economic outlook. Constructive equity markets and structural trends in technology and ESG mandates that are creating further opportunities in the world's deepest and most active market. To better leverage this opportunity, we've continued to strengthen and expand senior coverage teams in key sectors. We are already seeing strong results with a solid pipeline of mergers and acquisitions, advisory and equity underwriting revenue. We've also reorganized our global markets unit into newly created cross-platform groups, including the sales and relationship management group, to further strengthen our client-centric approach. The digital solutions and clients insights group will work to further scale RBC's data science, artificial intelligence, and digital expertise across product lines. To sum up, we have strong momentum across our core franchises, and we will continue to focus on providing holistic solutions to grow and deepen client relationships with a goal of delivering long-term sustainable value. While we will continue to invest in new strategies, we remain committed to running our bank efficiently with an emphasis on driving productivity. We're also committed to delivering on our purpose of helping clients thrive and communities prosper. This includes our commitment to play an active and accelerated role in addressing climate change. Supporting and financing our clients' efforts in the transition to net zero is central to our strategy. I'll now turn it over to Rod. Thanks, Dave, and good morning, everyone. Starting on slide nine, we reported quarterly earnings per share of CAD 2.76, up from CAD 1 per share last year. Pre-provision, pre-tax earnings of CAD 5.1 billion were up 11% year-over-year, despite significant headwinds from lower interest rates and a stronger Canadian dollar. Moving to slide 10, our CET1 ratio of 12.8% was up 30 basis points from last quarter. A strong quarterly return on equity of over 19% drove record internal capital generation of 43 basis points even after paying out CAD 1.5 billion in dividends to our common shareholders. This was partly offset by RWA growth, largely due to robust volume growth in Canadian banking and City National and higher trading activities in capital markets. I'll now spend some time discussing the outlook for our CET1 ratio heading into the back half of 2021. We expect the implementation of model parameter updates to increase our CET1 ratio by approximately 70 to 80 basis points next quarter. This benefit is expected to be modestly offset by an increase in SVaR multipliers effective next quarter, which is estimated to decrease our CET1 ratio by approximately 10 to 15 basis points. Also, we have seen net credit upgrades of approximately CAD 3 billion in the first half of 2021, only partially offsetting a cumulative CAD 13 billion impact from net credit downgrades between Q2 and Q4 last year. We expect to continue generating 15-20 basis points of capital per quarter, net of dividends and RWA growth. Moving on to slide 11. Net interest income was down year-over-year, largely due to the impact of lower interest rates, including lower repo and secured financing revenue in Capital Markets. All bank net interest income continued its strong recovery after bottoming out in Q3 of last year, driven by strong volume growth in Canadian Banking and City National. We expect core net interest income to continue to grow in 2022. Moving to segment-level performance, Canadian Banking NIM increased one basis point quarter-over-quarter, but was down one basis point excluding the higher-than-average mortgage prepayment revenue. While lower interest rates and credit card balances lowered Canadian Banking NIM 15 basis points year-over-year, higher card payment rates have been positive for credit quality. Looking forward, we expect strong Canadian Banking volume growth to drive higher net interest income even as NIM modestly contracts over the back half of 2021, partly due to a continued shift in asset mix. City National's NIM was up four basis points relative to last quarter, with the Paycheck Protection Program loans contributing most of the increase. Net interest income at City National was up 4% year-over-year, driven by continued strong volume growth. We expect this trend to continue going forward, even as City National's NIM continues to narrow over the next two quarters, partly driven by a continued build in excess deposits. City National's average loan-to-deposit ratio of 75% has decreased from pre-pandemic levels of 84% in Q1 2020. Turning to slide 12. While we don't expect short-term policy rates to increase in the near term, we have strong leverage to rising interest rates as half our deposits are zero- or low-rate core deposits. In addition, the economic recovery is expected to see further growth in higher-yielding asset classes as credit cards and commercial loan utilization rates begin to tick higher in Canadian Banking. City National has a more asset-sensitive balance sheet with roughly 50% of its loans being floating-rate commercial loans. Looking forward, a 25-basis-point increase in interest rates across the curve and stable deposit beta could generate an additional CAD 135 million in Canadian Banking net interest income over a 12-month period, and a 25-basis-point increase in U.S. interest rates could generate a further $90 million of revenue in U.S. wealth management, including the benefits from our sweep deposits. Turning to slide 13, our results this quarter continue to highlight the benefits of a diversified business model as market-related revenue across our largest segments benefited from elevated client activity and constructive markets. This continued to offset pandemic-related headwinds in our personal and commercial banking businesses. Strong capital markets activity boosted underwriting and advisory revenue, resulting in higher credit fees. Continued growth in both AUA and AUM helped drive higher mutual fund and investment management fees in wealth management and Canadian banking. On slide 14, non-interest expenses were up over 7% year-over-year, largely driven by higher compensation, commensurate with strong results in wealth management and capital markets, along with market-related movements in our U.S. wealth accumulation plan. Our results in the current quarter also included a favorable sales tax adjustment of approximately CAD 40 million across all businesses. Excluding variable and stock-based compensation, expenses were down 4% from last year. Further adjusting for FX, our controllable costs were largely flat year-over-year, and this is after already lowering the growth rate over the last two years. As economies reopen, we remain focused on controlling key discretionary expenses like travel and prioritizing investments that drive client value. We'll also continue to execute our zero-based budgeting program that has resulted in a number of effective cost containment initiatives being implemented across RBC. Now moving on to our business segment performance beginning on slide 15, Personal and Commercial Banking reported earnings of over CAD 1.9 billion, largely driven by Canadian banking. In Canadian banking, pre-provision, pre-tax earnings were up 8% from last year. Canadian banking revenue growth was up 4% year-over-year, driven by double-digit growth in mortgages, personal and business deposits, higher mutual fund distribution fees, and continued strength in direct investing volumes. Card service revenue was also up due to higher purchase volumes, as well as lower costs related to our Rewards program. Canadian Banking expenses were well controlled, down 1% from last year, helping to drive operating leverage of 4.7%. Historically, we have targeted 1%-2% operating leverage in Canadian Banking through the cycle, and we would expect to be above the top end of that range over the next few quarters. Turning to slide 16, wealth management reported quarterly earnings of CAD 691 million, up 63% from last year. Canadian wealth management revenue was up 15% year-over-year, with AUA up 22%, or nearly CAD 90 billion. Global Asset Management revenue increased 26% year-over-year, with AUM up 15%, or over CAD 70 billion. RBC GAM net sales were nearly CAD 15 billion in the quarter, with continued strength in institutional mandates, including BlueBay. Canadian long-term retail sales of over CAD 7 billion remained healthy in a quarter where the Canadian mutual fund industry recorded a strong RRSP season. The majority of our retail net sales flowed into balanced mandates with lower net sales into fixed income strategies, partly related to a pullback in North American bond returns. U.S. wealth management AUA growth was also strong, up over 30% in U.S. dollars. Turning to insurance on slide 17, net income of CAD 187 million increased 4% from a year-ago, mainly due to lower travel and disabilities claims costs and the favorable impact of actuarial adjustments. Turning to slide 18, Investor & Treasury Services net income of CAD 120 million decreased 47% from a year-ago. Funding and liquidity and asset services revenue declined year-over-year as the prior year reflected a more constructive environment as well as higher gains from the disposition of securities. Lower interest rates continue to negatively impact client deposit revenue. Turning to slide 19, Capital Markets reported another record quarter with earnings of over CAD 1 billion. Corporate investment banking reported record revenue of CAD 1.2 billion, reflecting strong deal flow and elevated client activity. M&A advisory fees were the third highest on record as an improving macroeconomic climate has increased client confidence levels in boardrooms. Robust ECM revenue was underpinned by strong IPO activity and constructive equity markets. Looking forward, we're seeing increased client activity and momentum in our M&A advisory and ECM businesses. Global Markets had a very strong quarter with revenue of CAD 1.6 billion. We saw record equities results this quarter, benefiting from our participation in strong primary activity and derivatives flow. FICC trading results were down from last year, with lower volatility impacting rates and FX tradings. This was partially offset by increased client activity in client trading, which benefited from constructive markets. Lower spreads hurt the repo and secured financing business, which benefited from elevated client funding demand and rate cuts last year. While primary issuance has a positive implication for secondary activity, we do expect both debt underwriting and FICC trading results to moderate from strong results over the last year. To close, we have strong momentum across our core franchises and with a robust capital position, disciplined expense management, and leverage to higher rates, we are well-positioned to continue delivering long-term growth. With that, I'll turn it over to Graeme. Thank you, Rod. Good morning, everyone. Starting on slide 21, allowance for credit losses on loans of CAD 5.5 billion was down CAD 389 million compared to last quarter. This reflects PCL on impaired loans of CAD 177 million or 11 basis points, which was down two basis points from last quarter and is at its lowest level in over 15 years. It also reflects a CAD 260 million release of reserves on performing loans, primarily in Canadian Banking and Capital Markets. Our macroeconomic forecast shows continued economic recovery as government support remains in place and vaccine distribution accelerated in our key markets this quarter. This is further supported by the significant level of savings Canadian households have accumulated since the onset of the pandemic. At an estimated CAD 212 billion, these savings should help support a strong economic recovery. While our release of provisions this quarter was more than double our release in Q1, our ACL remains above pre-pandemic levels at 0.79% of loans and acceptances. We continue to take a prudent posture on allowance given the uncertainties associated with new COVID-19 variants, continued lockdown measures in a number of regions, and the significant government support that has suppressed defaults. I'll now speak to the credit performance of our key businesses, starting with Capital Markets. Compared to last quarter, gross impaired loans of CAD 700 million decreased CAD 157 million as we continue to see good resolution of previously impaired accounts, largely in the oil and gas sector, which benefited from a more supportive oil price environment. PCL on impaired loans was a net recovery of CAD 29 million this quarter, reflecting recoveries on loans in the oil and gas and other services sectors, partially offset by an impairment on a commercial real estate loan in the retail space. We also released reserves on performing loans in capital markets for the third consecutive quarter. This quarter's CAD 87 million release reflects continuing improvement in macroeconomic forecasts, particularly for Canadian and U.S. GDP, global equity prices, and oil prices. In wealth management, gross impaired loans of CAD 338 million increased CAD 49 million from last quarter due to higher new formations at City National from borrowers in the consumer discretionary and information technology sectors, and a few smaller borrowers in the commercial real estate sector. Despite these noted impairments, PCL on loans was relatively benign this quarter, and overall credit quality of the portfolio remains strong. In Canadian banking, gross impaired loans of CAD 1.4 billion was stable from last quarter, and a CAD 54 million increase in GIL in our retail portfolios was offset by a CAD 55 million decrease in GIL in our commercial portfolios. PCL on impaired loans of CAD 195 million was down CAD 22 million from last quarter, with decreases across all portfolios with the exception of our cards portfolio. Higher write-offs in cards are attributed to the end of our deferral programs in Q4 2020, with card balances written off after 180 days past due. I would note that delinquency rates for cards have decreased relative to last quarter, as the impact of the client deferral program has largely migrated through to conclusion. Looking at our portfolio more broadly, delinquency rates for all products and regions across Canadian banking are down compared to last quarter and remain at or below historical levels as government support programs remain in place, benefiting many of our clients both directly and indirectly. This quarter, we also released CAD 155 million of reserves on performing loans in Canadian banking. The release came primarily from our cards portfolio and our commercial portfolio, reflecting improvements in both macroeconomic forecasts, including GDP and short-term unemployment rates, and our overall credit outlook. Turning to the Canadian residential mortgage portfolio on slide 25. As Dave touched on, we have been growing our residential mortgage exposure and market share since the start of the pandemic while maintaining a prudent and consistent approach to risk management. Our origination metrics on loan-to-value, debt service, and FICO scores have remained largely unchanged compared to pre-pandemic levels. We have also stressed the portfolio for a higher interest rate environment, which demonstrate that the vast majority of our clients have the capacity to absorb a significant increase in interest rates. That said, we have taken a conservative approach to our reserves on performing residential mortgages, which are stable compared to last quarter, as improvements to our house price forecasts were offset by an increase in the weighting to our downside scenario, given the rapid growth in house prices since the start of the pandemic. To conclude, while credit trends improved this quarter, we continue to maintain a cautious approach to reserve releases until a larger percentage of the population is vaccinated, vaccines prove effective against new COVID-19 variants, and the economic recovery takes hold. At the onset of the pandemic, I noted that the prime nature of our retail portfolio and the diversity of our wholesale portfolio would serve as strong mitigants against the economic impact of COVID-19, and this remains true today. In our retail portfolio, FICO scores and LTVs remain strong, and our clients have increased savings and lower utilization rates on cards and personal lending products throughout the pandemic. In our wholesale portfolio, diversification across sectors has served us well, with just 4.5% of total loans acceptances to sectors most vulnerable to COVID-19. Additionally, we are seeing positive trends in many of our key credit indicators. Watch lists are declining, upgrades are outnumbering downgrades, and delinquency trends are stable. As well, both our retail and wholesale portfolios are well-diversified geographically, which has helped mitigate the risk of an uneven global economic recovery and has allowed us to benefit from the reopening of the economies in certain regions. With many government programs scheduled to conclude in the fall, we do expect delinquencies and impairments to increase in Q4 and into the first half of 2022. However, we don't expect them to be as acute as we initially expected at the onset of the pandemic. Additionally, we expect to be able to draw down on the allowance on performing loans we built in 2020, such that our total PCL across all stages will remain below long-term averages. With that, operator, let's open the lines for Q&A. Thank you we will now take questions from the telephone line. If you have a question and using a speaker phone, please pick your headset before making your selection. If you have a question please press star one on your keypad. To cancel the question press star two. Please press star one at this time if you have a question. There will be a brief pause for participants register. The first question is from Ebrahim Poonawala from Bank of America Securities. Please go ahead. Got it. I guess my question was tied to capital return, Dave. In your prepared remarks, you talked about the payout ratio being at the low end as far as the dividend is concerned. Understanding that there's some benefit from a lower PCLs, higher capital markets. Talk to us, one, in terms of the dividend payout as we look into next year, your appetite for the dividend payout being at the higher end, maybe 50% or even exceeding that. Secondly, I think one question, given the significant capital build outlook that you outlined, can we see buybacks being significantly stronger than what we are used to from the Canadian banks or from Royal over the last five to 10 years? Yeah, thank you for that question. We were expecting that question, so thanks. As we look at how we best return capital to shareholders, given the strong capital, we have more than enough organic capital creation over time to drive our RWA growth. We see great opportunities for organic growth in the platform. That's first and foremost our objective that we always talk about. Even with that, we do, obviously, with our pro forma CET1 well over 13% in Q3, we see an opportunity to grow, accelerate growth, and return capital to shareholders at an accelerated rate. When it comes to your specific question around dividend payout ratio, our current philosophy, and that won't change in the long term, is to link our dividend payout to core earnings growth as you referenced. We've let that trail to the lower end, given the inability to raise dividends. The first and foremost, the signal in our comments was we view our core earnings to be very strong. You heard me articulate a number of tailwinds that are already embedded in our business. Better credit card performance, more active customers. We're down almost, I think, CAD 4 billion in credit card balances. That's driving that CAD 400 million revenue. We expect that to come back. We've got strong embedded profitability in our core deposit book, as we talked about, both in Canada and the U.S. All those provide tailwinds on our existing book of business that give us confidence in our core earnings and ability to move that payout ratio back up to the top end of the range. I would say from a strategy of returning earnings and core earnings to shareholders, that remains the same. There's ability for us to, given we feel the tailwinds, our ability to do that with our strong capital ratios. You turn to the question of longer-term capital return to shareholders. We have a number of tools to do that. Yes, we do expect to use accelerated buybacks as one of the core tools to return capital to shareholders. We will look at other mechanisms around dividend return. We're running a number of scenarios trying to optimize the return to our shareholders, taking all factors into consideration. The answer is yes to both. It's great to have the luxury to feed accelerated organic growth, to increase our dividend based on current core earnings, and to return increasingly excess capital to our shareholders. Got it. Thank you. Thank you. The next question is from Gabriel Dechaine, National Bank Financial. Please go ahead. Yeah, I have a similar question, actually, and more so on the organic RWA growth because you do have, pro forma, close to CAD 12 billion of excess capital above 11%. You got the buybacks, you got the dividends, but there are limitations there. I'm just wondering how you're thinking about capital consumption via organic growth, and what does accelerated growth look like to you? How long it could take to kind of chew through that excess capital? Which is great to have, but it also suppresses your returns, ironically, during a quarter where you have a 19% ROE. Maybe I'll start, and maybe Rod wants to jump in after. In my comments, obviously, we highlighted a couple of new platforms, particularly the mid-market commercial in the U.S., where we're looking at largely private companies with revenues between anywhere from CAD 2 billion-CAD 5 billion. Very attractive companies. We've got a whole team that we've stood up there. We got our leader in Richard Raffetto, who has built that business at other large banks, and therefore we feel very confident in our ability. There's new growth trajectories such as that. We expect drawdowns, as I said, in our operating lines, which are quite significant. We're the market leader in business financing, and our operating lines are at currently low utilization. Again, there's going to be draws on that that are going to consume capital. We've got a fantastic global Capital Markets business, particularly in a very large and active U.S. marketplace that's going to need capital for underwriting and increased lending opportunities that we're seeing, and we've got a very active pipeline. We've got core businesses that we expect accelerated growth to come from new clients, from existing business on the balance sheet that will start to consume, we think, a little more RWA than we previously put out there. I think we feel very good about our growth opportunities and getting to manage that well within our current risk appetite. Having said that, to your point, that's not going to consume the excess capital on our balance sheet, and therefore our core acquisition strategy remains focused and unchanged. We're looking to create shareholder value and growth through an acquisition strategy. We remain highly focused and very picky about how we would deploy any capital into an acquisition. There still remains a significant opportunity for us to do all of that and return capital to shareholders. It's a great position. To be in. Those are businesses that we think will start accelerating, that are going to consume more RWA and position us to outperform on growth across our Canadian Banking, U.S. wealth management, commercial banking, and global Capital Markets operations. All are seeing heightened client activity and all have very strong networks. We've invested in expanding capability to capture that growth. We're very excited about the opportunities going forward. Thank you. Good. Thank you. The next question is from Meny Grauman from Scotiabank. Please go ahead. Hi, good morning. Just one clarification before my real question. How much of the CAD 40 million sales tax adjustment that Rod called out was in Canadian Banking? I think this goes across our Canadian businesses. We didn't disclose that, but the Canadian Banking business is a good share of our overall businesses in Canada. All of our businesses are obviously number one and number two market share in Canada, so you can roughly allocate that based on the size of the Canadian Banking business. We're not disclosing that, but it was a fair amount, but not a substantial amount. Thanks for that, Rod. Then just wondering, we've heard from a few peers, they talked about post-pandemic step function up in terms of the run rate of their capital markets business. I'm wondering from your perspective, how you view your capital markets business coming out of the pandemic. In your commentary, you talked about maybe a little bit of a moderation in terms of some of the trading revenue. Regardless of markets, is there a step function in your capital markets business? Do you feel like you've made headway through this volatile period? Sure. It's Derek Neldner. I'll take that question. Thank you for it. I'd come at it two ways. I think if we look at the pipeline overall right now, further to Rod and Dave's comments, we continue to see a very strong backlog in pipeline in our investment banking platform, really driven by M&A as well as ancillary financing. Some of the flow financing has moderated a little bit from the peaks, but we continue to see very good levels of activity. In our corporate banking business, while as you would've seen from prior quarter results, our loan utilizations in corporate banking came down significantly following the peak post-pandemic last year. We have seen that stabilize, and we're seeing a lot of good incremental financing opportunities to support our corporate clients come up on the back of M&A and organic growth initiatives that our clients are pursuing. In the markets business, we've obviously had a very robust backdrop for the last 12 months. We do expect that we'll normalize from the peaks, but continuing to see a very good both equity and fixed income market. We do expect that while it will normalize above pre-pandemic levels. I think the second item I would highlight, and further to some of Dave's comments, is notwithstanding some normalization in the market, we feel we've got a very sound strategy to continue our growth in capital markets. We've made some important investments in the talent side. We've done some reorganization of our business that Dave alluded to in his comments, and so we do think that through a number of our initiatives and investments, we are well-positioned to continue to grow our client businesses, increase our market share, and that should move our business to a level above where it was pre-pandemic. Thanks, Derek. I'm going to leave you on. Thank you. The next question is from Doug Young from Desjardins Capital Markets. Please go ahead. Hi, good morning. Just my questions are focused on City National Bank. Rod, I think I missed, or maybe you didn't give it, but maybe I missed what the impact would be from a 25 basis point increase in rates just on that business. I was hoping you could break that business out a little bit more. I don't think I can get to what pre-tax, pre-earnings was this quarter, but if you could elaborate on what that was and how the growth, or if there was growth year-over-year. If we strip out the noise from PCLs, what would be the outlook on a pre-tax, pre-provision basis for this business over the coming years? Thanks. Sure. Thanks for that, Doug. We disclosed the impact across the two businesses, $85 million? It's roughly half and half, if you will, between the private client business and the City National business, given the sweep balances there. Of course, the City National would be more beneficial if long rates also rise, given the loan book, and that half of the book is variable, but half the book is also longer-term fixed, including some growing mortgage book, whereas the sweep business is not. In terms of the pre-tax, pre-provision for that business, you're looking at roughly $200 million typically, around there, on a standalone basis. That's if you look at their call reports. Obviously, we have some purchase accounting and other stuff, which mostly you adjust out anyway. That is poised to grow. We have been hampered by lower interest rates. Our margins have come way down. We've continued to invest in that business. We've taken the rate of expense growth down, we're still investing in that business and still growing the expense base. Whereas we had probably the first 3.5 years after the acquisition, we had very positive operating leverage, we were growing expenses mid-teens. We're growing expenses in the single digits, the revenue growth was slowing because of interest rates, now we're basically ready for growth. We're growing deposits and loans double digits. We're growing the mortgage book. We're still growing commercial loans, that should, again, expand as the U.S. economy goes up. We should see higher earnings. We tend to hit the high point in Q3 of 2019, if you will, but we should see growth throughout 2022 and into 2023. Great. Thank you. Thank you. The next question is from Scott Chan from Canaccord Genuity. Please go ahead. Good morning. Maybe going back to Derek on capital markets. You kind of cited U.S. is roughly 50% of the revenue, and the other half is non-U.S. Maybe you can talk about some of the themes that you talked about within IB and global markets, if there's any differences. Because you are a global markets platform, is there any revenue synergies that maybe you can speak to, perhaps that have risen from the pandemic? Sure. A couple of questions in there that I'll try to address. From a geographic perspective, as Dave mentioned, over half of our revenue today would be in the U.S. We do also have a very strong platform in Europe and obviously the strength of our domestic platform in Canada. We're very happy with our geographic footprint. We see very good growth opportunities in the U.S., and it continues to be the primary focus, but we'll invest in the global platform where we see good opportunities. Clearly the U.S. is where we see the most attractive opportunity at this point in time. Between corporate investment banking and global markets in terms of differences we see in terms of the outlook, as I mentioned, right now, the pipeline's very robust on the investment banking side. We are optimistic that will continue for some time given the confidence that we've seen return to corporate clients as the economy has reemerged. We do see a little bit more normalization in the markets business. You saw that quarter-over-quarter. We expect that that will continue. A little more strength maybe on the corporate investment banking side with a little more moderation in the market side of the business. I think finally, in terms of your comment on synergies, this is an area where as we've continued to invest and grow our business, we have really been focused on driving more synergies both across geographies and across our platform. All these businesses are very interrelated. Our investment banking activity is clearly supported by the loan book as we see primary issuance that drives secondary trading activity and that can then trigger cross-sell opportunities across other businesses. We feel we're doing a good job capitalizing on those synergies, but we continue to believe there's more we can do there. We've undertaken some reorganization of the business to allow us to better capture that, and we feel good about the opportunity ahead to do so. Great. Thank you very much. Thank you. The next question is from Lemar Persaud from Cormark Securities. Please go ahead. Thanks. I just want to flip back to domestic mortgages. Domestic mortgage growth seemed to slow a bit sequentially relative to what we've seen at some peers. When I see this, and just knowing that Royal was actively taking market share, it just makes me wonder if you guys are intentionally tapping on the brakes because maybe the risk/reward isn't there or maybe there's something else. Just wondering if you could offer any commentary on that. Yeah, thanks for the question. It's Neil. I think we look at the mortgage business, and it's definitely not a question about risk. We like the risk. To your point, we've been growing the mortgage business in double digits for over a year now and still consider it to have tremendous momentum. If you look at quarter-over-quarter, we did see some exceptionally aggressive pricing in the market, both in terms of rates that were offered. We saw spreads really come in. Also, in terms of the acquisition offers that we saw some competitors offering more than double what we're seeing standard in the marketplace. We did just take that opportunity with all the momentum to make a choice to say, we're going to continue to compete and protect our relationship clients. We were looking to really compete for the better spread deals, and that had to slow down, I'd say, marginally in the quarter. We have zero concern, I'll tell you, in terms of our ability to continue to grow share in the mortgage business, and I'd expect that momentum you'll see return in Q2, sorry, Q3. Excellent. That's it for me. Thank you. Thank you. The next question is from Sohrab Movahedi from BMO Capital Markets. Please go ahead. Yeah, thanks. I just wanted to go back to Graeme, if I could. Graeme, I think you said you've taken a cautious approach to reserve releases, or you are taking a cautious approach to reserve releases. Obviously, I think the total bank, total PCLs were in a net recovery. If I look at your last five years, maybe the average has been more in the 35-ish%, 35 basis point range, sorry. I just want to make sure I understand. Are you suggesting that, call it zero or even recovery positions at the total PCL for the total bank could persist for the foreseeable future? Thanks for that question. Yeah, it's certainly a good thing to talk through because there's a lot of complexity between the different stages of allowances here. Certainly this quarter in a total PCL perspective, we were in a net release position. When you say for the foreseeable future, obviously we can't be in that kind of spot for an extended period. If you look at how this could play out in the coming quarters, and certainly this is very conditional on some of those key proof points I referenced in my comments. We're really dependent on how the vaccine rollout proceeds in the coming months, that we really get the health outcomes we're looking for, how the economy reopens subsequent to that, and then thirdly, really how the transition off of government programs concludes, if you will. Obviously a lot of dependencies on those, but we are seeing very good. Fundamental credit indicators in our portfolio, that's obviously seen that translate into very low stage three losses. All the data and analytics would indicate in the near term that we will have continued good stage three performance. As we get more confident in those proof points I referenced, that could yield further stage one and two releases. We do expect, though, over the latter half of this year and into kind of the earlier half of 2022, that those impairments and delinquencies will rise, and stage three will rise with that. Again, I think we've got a very prudent loans built up in stage one and two, that'll be more funded by kind of transition out of stage one and two and into stage three. That's why I kind of comment. The variability between those three stages could change depending on how those factors play out over the coming months. In aggregate, we feel quite confident that the total PCL will remain within our long-term averages, and in the near term could see continued benefits. Okay. Thank you. Thank you. The next question is from Mario Mendonca from TD Securities. Please go ahead. Good morning. Rod, if we could go to some comments you've offered in the past on the expense side. You suggested that operating leverage could be better in the second half of 2021 than it was in the first half. Looking at expense trends in 2020, it does look like operating leverage should be a fair bit better. Can you offer any outlook on operating leverage in the second half in the context of some areas of the expense line that you should see some increases or maybe moderation in expense there? Thanks, Mario. You know I like to kind of bifurcate between stock-based comp, variable comp, FX, and then all the other expenses that are more controllable, which we've done in the chart that we added. I would expect that we would have positive operating leverage into the second half of this year. Canadian banking is well-positioned for positive operating leverage with good expense discipline. I think our FTE might have been up year-over-year, down quarter-over-quarter. We're managing that well, we're continuing to grow the client base. Now revenue growth is accelerating. You look at the wealth businesses. A lot of that depends on the markets. If we keep constructive equity markets, we should see continued positive operating leverage. At the all-bank level, a lot of it gets down to mix. You can run a scenario where you have positive operating leverage of 2% across all five segments and at negative at the top of the house. Some of the accounting and insurance can confuse the top of the house because you can get some big trades that have big revenue, but also PBCAE, it kind of disrupts the NIE. All in all, we should see positive operating leverage at the top of the house in the second half of the year, absent some market disruption. Okay. Then just my final question is on the all-bank margin. I like to separate what I see from the domestic and the U.S. retail banking segments from what I see at the rest of the bank. It does seem to me that we should see some progression in the margin because low margin liquidities are coming down, rates are moving higher, cards might improve. I didn't get the sense from listening to your opening comments that you'd expect the all-bank margin to improve. I may have misunderstood, but what is that outlook? If it's not going to improve, can you offer some reasons as to why? Yeah. Thanks for that. It's important to look at that. There's a lot of complexity to that as you get into, right? We're going to see positive net interest income at the Canadian banking level in the second half of the year. We're going to see positive net interest income growth in City National in U.S. dollar terms. We'll see positive for both of those for the full year, which I think is important. What you might see because of the stronger Canadian dollar is you might see that benefit at the top of the house kind of evaporate as you convert it from U.S. dollars to Canadian dollars. We'll get a benefit on that in expenses, so it's not going to hurt earnings. Similarly, loan book margins in Derek's business have come down. Utilization is down versus a year ago, and margins have come down. There's so much liquidity out there. You got to look at some of those other businesses. Trading net interest income might see a little bit of headwinds, but it's not a big driver. Loan book and capital markets, again, not a big driver. When you add all of that up, because of foreign exchange, because of trading book, you might see it moderate and be kind of zero-ish, but the core businesses, you're going to see net interest income growth in the core businesses in local currency, and that's what's going to drive the overall earnings at the top of the house. Okay. Thank you. Thank you. The next question is from Paul Holden from CIBC. Please go ahead. Thank you. Good morning. I want to kind of go back to a point Rod just made in his answer regarding the amount of liquidity out there, and I appreciate your optimism regarding the outlook for NII and loan growth, and I'm totally there with you given economic data we're seeing out of the U.S. The concern, I guess, is that there's so much liquidity out there that maybe that return to loan growth at the industry level might take longer than we were originally thinking. Wondering if you can put some thoughts around the timing on that. Not to a specific quarter, but will it come later in 2021? Will we have to wait for 2022? Will we have to wait for later in 2022? Just sort of some general thoughts around timing would be helpful. Yeah. Paul, maybe I'll start, and then Rod can jump in. In my comments, we tried to signal that one of the big categories of loan growth for us and a bigger contributor is the return of our credit card balances back to the CAD 19 billion-CAD 20 billion range from CAD 16 billion. That has normally been highly correlated to economic activity in the economy and purchase activity on those cards. As we do the analysis and we look at who's got excess deposits and who's using their credit cards, we do expect that relationship will continue to hold going forward. There may be a little bit of a lag that because of the excess liquidity out there, it won't be a perfect correlation that you saw historically through economic cycles. There may be a lag, but we don't think it's a significant lag. Client behavior is client behavior. That will come back along with increased card purchases in the economy. I think there's an example of liquidity being out there, but clients keeping liquidity, investing liquidity, and us getting the card growth. On the business side, business financing side, certainly liquidity and optimizing their cash flow probably will play a bit of a lag, and I think you're already seeing that. You're already seeing the economy, certainly in the mid-market commercial end, that utilization rates continue to be at kind of cyclical lows. Therefore, I would have expected, given some of the economic activity, that inventory and receivable builds would have led to drawdown, and you're not seeing that per se. There's an example of it already kind of lagging, but it will come. It will come through the cycle. On the corporate side, certainly you're seeing liquidity lead and pay downs of those draws you saw last year. As Derek just pointed out, now that they've come through that, there's a focus on growth among all clients, and you're going to start to see drawdowns there. There's examples of walking through three businesses where there is a certain lag in a couple of them, but you're starting to see the correlations rebuild. Rod, did you want to add anything to that? You look structurally at some of the points Dave made, right. You've got the force working against you is the liquidity. Arguably 20 years of savings rate in both Canada and the U.S. over the last year. That hurts loan growth. You have structural mid-single-digit GDP growth that everyone's forecasting. That's going to drive it up. Plus, I think companies are going to be less likely to play more just in time because of supply chain issues that are out there. They're going to hold more inventory. That's going to be a positive. You look at our mix of businesses. Even when we've had negative loan growth in capital markets over the last year, we've had positive at the top of the house because we have such strength in diversified business model. City National, strong double digits. That's a good starting point. Even with our mortgage business going from double digits to high single digits, or even if it falls to mid-single digits by the second half of next year, because you put it all together, we're still going to have good positive loan momentum. In the glass half full side, it could feed into our investment business, as we talked about in our speeches. There's as many positives or more positives than there are negatives to that liquidity. Okay. Just want to go a little bit deeper here. Just on the business loan growth, you mentioned there could be a lag. Again, this is a little bit of guess for everyone, but do you think it's kind of a one or two-quarter lag, or could it be something that's a four-quarter lag, like a little bit more significant? Neil, do you want to take a stab at that? Yeah, sure. Just a little bit of color. We're really seeing it in the revolvers, and particularly a couple of sectors. In the core commercial business, we're seeing the revolver utilization rate down 10% from where we were pre-pandemic. I think you have to then look at the deposits. We're up about CAD 40 billion of deposits. I think as you start to see the economy reopen, you start to see entrepreneurs' confidence to invest that capital. I think it would be much closer to that kind of one to two quarters. We don't expect it to be in the four-quarter range. There's also sectors like, for example, our auto finance business. There just isn't the inventory to finance. That's related to the supply chain issues that Rod referenced. We expect that supply to come back online into early next year when we get these microchips to the manufacturers, and you'll see that really spring up, and we'll see strong growth there. It'll be very similar comments as we look at our consumer lending business. We think probably a four-month type of lag between when you'd see that direct lending come back after the economy opens, people can start traveling, and we see some of the consumer spending Dave talked about really take off. That's helpful. Thank you. Appreciate it. We have one more question in the queue. We'll go to that. Thank you. The next question is Nigel D'Souza from Veritas Investment Research. Please go ahead. Thank you. Good morning. I wanted to ask the inflation question in a different way, and I was wondering if persistent U.S. dollar weakness, does that change how you evaluate your U.S. franchises? For example, if we get into a world where the Canadian dollar is closer to parity, does your strategy in the U.S. change? Do you start prioritizing Canadian businesses more, or does currency not have a major impact on your outlook here? I would say- Sorry, I hope you guys can hear me. I would say that currency doesn't have a long-term impact. In fact, it may make capital deployment into the U.S. a little easier at that point. Certainly, as you're looking at growing your franchise, given the size of RY and our goal to drive premium growth off of, as you saw, pre-tax, pre-provision earnings of CAD 5 billion, we need a deep U.S. business in capital markets. We need a deep business in U.S. Wealth Management and Commercial Banking to continue to drive Profit outperformance, therefore the U.S. market remains absolutely critical to overall growth strategy and outperformance strategy, regardless of where the U.S. dollar is. In fact, it may accelerate our ability to grow. I think, dollar is going to impact earnings, obviously, impact our RWA, but it's not impacting the overall need and our overall construct of how we want to balance growth between Canada, the United States, and Europe. That makes sense, and it's a good color. Thank you. Is that it? Thank you. This concludes today's question and answer session. I'd like to turn the meeting back over to Mr. McKay. I just want to thank everybody for their questions and just the core messages that I think came out both in the speeches but also in a lot of great questions that we received, that we're very happy with our pre-tax, pre-provision earnings up 11% to CAD 5 billion. I think it really highlights the organic growth capability of this franchise. You saw strong performance across the board. We had a chance to highlight where we see embedded profitability in business we've already earned from clients, whether that's the existing credit cards in customers' hands, whether that's the significant number of operating lines that we already have with customers that will get drawn, and increased overall economic activity will drive growth without having to earn a new client. We've got the interest rate tailwind that we think differentiates ourselves both in Canada and the U.S. already on our balance sheet. You heard a number of strategies to acquire new clients and grow, whether that's a unique RBC Vantage in leveraging our differentiated loyalty platform to completely change the core client business. We're having enormous success with the College of Surgeons in attracting high-net-worth medical professionals in Canada, and we're very excited about that. You heard about our new growth strategy in the mid-market corporate on top of very successful, as Rod pointed out, mortgage strategy in the U.S. that's really getting significant traction with already CAD 15 billion of mortgages on our balance sheet in the U.S. and growing core double-digit growth in our City National Bank we expect to continue. We feel that the investments we've made, we didn't back off. Capital markets opportunities are significant in our advisory, M&A ECM and DCM business. We feel very well poised now through historic investments to capitalize on the growth and the investments that are going to get made to transition and improve our society. Thank you very much for your questions, and I look forward to seeing you in Q3. Have a good summer. Thank you. The conference has now ended. Please disconnect your lines at this time, and thank you for your participation.