Royal Bank of Canada (NYSE: RY – $57.41), Canada’s second-largest bank by assets, posted an 11% rise in fourth-quarter profit that topped market expectations as gains in retail banking and capital markets more than offset bad loans in the oil and gas sector. For the period, RBC’s net income rose to C$2.59 billion and excluding special items, earnings were C$1.77 per share. Analysts, on average, expected C$1.64 a share. RBC said its profit for the August-to-October quarter was fueled by stronger contributions from its capital markets and domestic retail-banking arms, which offset weaker results in other key divisions, including wealth management. Personal and commercial banking earnings were up 10% in the latest quarter, while capital-markets profit rose 38%. Wealth-management earnings were down 11% due to lower transaction volumes and a C$38-million after-tax charge related to the restructuring of the bank’s U.S. & International Wealth Management business, which included the recent sale of its Swiss operations. For the year, Royal Bank recorded C$10.03 billion (US$7.49 billion) in earnings equal to $C$6.75 per share, the first time a Canadian company has topped C$10 billion in a fiscal year. Canadian banks have managed to largely shrug off a soft domestic economy, concerns about the housing market and fallout from an oil price slump. RBC, however, said it is seeing early signs of stress in Alberta and noticed a slight increase in auto and credit card delinquencies. Total provisions for credit losses, the money the bank sets aside to cover bad loans, fell 20% to C$275 million, mostly because of lower reserves for Caribbean banking. On a sequential basis, however, total provisions edged up 2% because of more money set aside in its capital-markets division. The shares, yielding 4.1%, can be held for price recovery and decent long-term total returns.