S&P maintains rating on Royal, outlook negative from Enron overhang

BA N K I N G

Standard & Poor’s Ratings Services has confirmed its counterparty credit ratings on Royal Bank of Canada and its units at AA-/Negative/ A- 1+ with a negative outlook. S&P said that, although Royal Bank is moving in the right direction to boost the performance of its U.S. retail operations, the negative outlook remains until the overhang of the Enron litigation risk is removed. It said Royal Bank has demonstrated its continued commitment to the U.S. through its support of RBC Centura, despite its problems. It said there is some uncertainly about the size of the settlement related to the Newby class action lawsuit, but said it doesn’t expect that a settlement would be more than a quarter’s earnings.