If the turmoil of the past two years has taught us anything, it is that success in banking demands both skill and luck. Royal Bank of Canada Capital Markets (RBC) is one of the handful of firms to get the balance of that recipe right, and it is now gaining market share at a speed that would have been impossible before the financial crisis.
In the first place, Canada's strict leverage constraints have left it in good shape while competitors have been fire-fighting or rebuilding capital. The acknowledgement a couple of years ago that it was struggling to compete effectively in areas such as structured credit and commercial mortgage-backed securities led to a rethink and an early exit from those businesses. Moreover, pre-crisis, RBC's lack of traction in the hedge-fund business looked like a weakness; now, its focus on real money accounts is where everybody wants to be.
