[424B2] Royal Bank of Canada Prospectus Supplement
Royal Bank of Canada (RY) is marketing five-year Auto-Callable Contingent Coupon Barrier Notes linked to the worst-performing of the Nasdaq-100, Russell 2000 and S&P 500 indices. The $1,000-denominated senior unsecured notes pay a contingent coupon of 9.50% p.a. (2.375% quarterly) only if, on the relevant observation date, all three indices close at or above 75% of their respective initial levels. If any index is below its threshold, no coupon is paid for that quarter, and skipped coupons are not made up.
Automatic call mechanics: Beginning with the fourth quarterly observation date (July 2 2026) the notes will be redeemed at par plus the current coupon if each index is at or above its initial level. Early redemption would shorten the holding period and cap income to the coupons received up to that call date.
Principal protection is conditional. At maturity (April 5 2030) investors receive: (i) par plus the final coupon if the worst-performing index is at or above 60% of its initial level, or (ii) a loss matching the percentage decline of the worst index if it finishes below the 60% barrier (e.g., a 50% index decline delivers $500 per $1,000 note).
The deal is offered at par, but RBC’s own initial estimated value is $927.50–$957.50, reflecting a 4.3%-7.3% premium over fair value due to a 1.00% underwriting fee, up to $10 selling concession and hedging costs. Notes are not listed; liquidity will depend on RBC trading and may be limited, with wide bid-ask spreads.
Key risks include: potential loss of principal, possibility of receiving few or no coupons, limited upside (no participation in index gains beyond coupons), credit exposure to RBC, complex tax treatment, and illiquidity. The multi-index, “worst-of” structure means performance is driven by the weakest index, eliminating diversification benefits.
Target investors are yield-oriented accounts comfortable with equity-linked risk who can tolerate a full loss of principal, understand structured products and are willing to hold to maturity or call.
Royal Bank of Canada (RY) offre note a cinque anni Auto-Callable Contingent Coupon Barrier legate all'indice peggiore tra Nasdaq-100, Russell 2000 e S&P 500. Le note senior non garantite denominate $1.000 pagano un coupon condizionato del 9,50% annuo (2,375% trimestrale) solo se, alla data di osservazione, tutti e tre gli indici chiudono al 75% o più dei loro livelli iniziali. Se uno degli indici è sotto la soglia, il coupon per quel trimestre non viene pagato e i coupon saltati non sono recuperabili.
Meccanismo di richiamo automatico: a partire dalla quarta data di osservazione trimestrale (2 luglio 2026), le note saranno rimborsate a valore nominale più il coupon corrente se ogni indice è pari o superiore al livello iniziale. Il rimborso anticipato ridurrà il periodo di detenzione e limiterà i guadagni ai soli coupon ricevuti fino a quella data.
La protezione del capitale è condizionata. Alla scadenza (5 aprile 2030) gli investitori riceveranno: (i) il valore nominale più l’ultimo coupon se l’indice peggiore è almeno al 60% del livello iniziale, oppure (ii) una perdita proporzionale al calo percentuale dell’indice peggiore se questo scende sotto la barriera del 60% (ad esempio, un calo del 50% dell’indice comporta un rimborso di $500 per ogni nota da $1.000).
L’offerta è a valore nominale, ma il valore stimato iniziale di RBC è compreso tra
I rischi principali includono: possibile perdita del capitale, possibilità di ricevere pochi o nessun coupon, guadagni limitati (nessuna partecipazione ai rialzi degli indici oltre i coupon), rischio di credito verso RBC, trattamento fiscale complesso e illiquidità. La struttura multi-indice “worst-of” significa che la performance dipende dall’indice più debole, eliminando i benefici di diversificazione.
Gli investitori target sono conti orientati al rendimento, a loro agio con il rischio legato all’equity, disposti a tollerare una perdita totale del capitale, che comprendono i prodotti strutturati e sono disponibili a mantenere l’investimento fino alla scadenza o al richiamo.
Royal Bank of Canada (RY) está ofreciendo notas a cinco años Auto-Callable Contingent Coupon Barrier vinculadas al índice de peor desempeño entre Nasdaq-100, Russell 2000 y S&P 500. Las notas senior no aseguradas denominadas en $1,000 pagan un cupón contingente del 9.50% anual (2.375% trimestral) solo si, en la fecha de observación correspondiente, los tres índices cierran al 75% o más de sus niveles iniciales. Si algún índice está por debajo del umbral, no se paga cupón en ese trimestre y los cupones omitidos no se recuperan.
Mecánica de llamada automática: A partir de la cuarta fecha de observación trimestral (2 de julio de 2026), las notas serán redimidas al valor nominal más el cupón vigente si cada índice está en o por encima de su nivel inicial. La redención anticipada acortaría el período de tenencia y limitaría los ingresos a los cupones recibidos hasta esa fecha de llamada.
La protección del principal es condicional. Al vencimiento (5 de abril de 2030), los inversores recibirán: (i) el valor nominal más el cupón final si el índice de peor desempeño está al menos al 60% de su nivel inicial, o (ii) una pérdida equivalente al porcentaje de caída del índice peor si termina por debajo de la barrera del 60% (por ejemplo, una caída del 50% en el índice entrega $500 por cada nota de $1,000).
La oferta es a valor nominal, pero el valor estimado inicial de RBC es de
Los riesgos clave incluyen: posible pérdida del principal, posibilidad de recibir pocos o ningún cupón, rendimiento limitado (sin participación en las ganancias del índice más allá de los cupones), exposición crediticia a RBC, tratamiento fiscal complejo e iliquidez. La estructura multiíndice “worst-of” significa que el rendimiento está determinado por el índice más débil, eliminando los beneficios de diversificación.
Los inversores objetivo son cuentas orientadas al rendimiento cómodas con riesgo vinculado a acciones, que pueden tolerar la pérdida total del principal, entienden productos estructurados y están dispuestos a mantener hasta el vencimiento o llamada.
Royal Bank of Canada(RY)는 Nasdaq-100, Russell 2000, S&P 500 지수 중 최저 성과 지수에 연동된 5년 만기 Auto-Callable Contingent Coupon Barrier Notes를 마케팅하고 있습니다. $1,000 단위의 선순위 무담보 노트는 연 9.50%(분기별 2.375%)의 조건부 쿠폰을 지급하는데, 해당 관찰일에 세 지수 모두가 초기 수준의 75% 이상으로 마감해야 합니다. 하나라도 기준 이하일 경우 해당 분기 쿠폰은 지급되지 않으며, 미지급 쿠폰은 보전되지 않습니다.
자동 콜 메커니즘: 네 번째 분기 관찰일(2026년 7월 2일)부터 각 지수가 초기 수준 이상일 경우, 노트는 액면가와 현재 쿠폰과 함께 상환됩니다. 조기 상환 시 보유 기간이 단축되고 해당 콜일까지 받은 쿠폰까지만 수익이 한정됩니다.
원금 보호는 조건부입니다. 만기일(2030년 4월 5일)에 투자자는 (i) 최저 성과 지수가 초기 수준의 60% 이상일 경우 액면가와 최종 쿠폰을 받거나, (ii) 최저 지수 하락률만큼 손실을 입게 됩니다(예: 지수가 50% 하락하면 $1,000 노트당 $500 지급).
본 딜은 액면가로 제공되나, RBC의 초기 추정 가치는 $927.50~$957.50로, 1.00% 인수 수수료, 최대 $10 판매 수수료, 헤지 비용으로 인해 공정 가치 대비 4.3%-7.3% 프리미엄이 반영되어 있습니다. 노트는 상장되어 있지 않으며, 유동성은 RBC 거래에 따라 달라지고 제한적일 수 있으며, 매수-매도 스프레드가 넓을 수 있습니다.
주요 위험으로는 원금 손실 가능성, 쿠폰 수령 제한 또는 미지급, 제한된 상승 잠재력(쿠폰 외 지수 상승 참여 없음), RBC 신용 위험, 복잡한 세금 처리, 유동성 부족 등이 있습니다. 다중 지수 ‘최저 성과’ 구조는 가장 약한 지수가 성과를 좌우해 분산 효과가 사라집니다.
대상 투자자는 수익 지향 계좌로, 주식 연계 위험을 감내할 수 있고 원금 전액 손실을 견딜 수 있으며, 구조화 상품을 이해하고 만기 또는 콜까지 보유할 의향이 있는 투자자입니다.
La Royal Bank of Canada (RY) commercialise des billets à barrière à coupon contingent auto-remboursables sur cinq ans, liés à la performance la plus faible parmi les indices Nasdaq-100, Russell 2000 et S&P 500. Ces billets senior non sécurisés, libellés en 1 000 $, versent un coupon contingent de 9,50 % par an (2,375 % trimestriel) uniquement si, à la date d'observation concernée, les trois indices clôturent à 75 % ou plus de leurs niveaux initiaux. Si un indice est en dessous du seuil, aucun coupon n’est versé pour ce trimestre, et les coupons non versés ne sont pas rattrapés.
Mécanisme de remboursement automatique : À partir de la quatrième date d’observation trimestrielle (2 juillet 2026), les billets seront remboursés au pair plus le coupon courant si chaque indice est au moins égal à son niveau initial. Un remboursement anticipé réduirait la période de détention et limiterait les revenus aux coupons perçus jusqu’à cette date de remboursement.
La protection du capital est conditionnelle. À l’échéance (5 avril 2030), les investisseurs recevront : (i) le pair plus le coupon final si l’indice le plus faible est au moins à 60 % de son niveau initial, ou (ii) une perte correspondant à la baisse en pourcentage de l’indice le plus faible si celui-ci termine sous la barrière des 60 % (par exemple, une baisse de 50 % de l’indice entraîne un remboursement de 500 $ par billet de 1 000 $).
L’offre est proposée au pair, mais la valeur initiale estimée par RBC est comprise entre 927,50 $ et 957,50 $, ce qui reflète une prime de 4,3 % à 7,3 % par rapport à la juste valeur en raison de frais de souscription de 1,00 %, jusqu’à 10 $ de commission de vente et des coûts de couverture. Les billets ne sont pas cotés ; la liquidité dépendra des transactions de RBC et pourrait être limitée, avec des écarts acheteur-vendeur importants.
Les risques clés incluent : la perte potentielle du capital, la possibilité de recevoir peu ou pas de coupons, un potentiel limité à la hausse (pas de participation aux gains des indices au-delà des coupons), une exposition au crédit de RBC, une fiscalité complexe et une illiquidité. La structure multi-indices « worst-of » signifie que la performance est déterminée par l’indice le plus faible, éliminant les bénéfices de diversification.
Les investisseurs cibles sont des portefeuilles orientés rendement, à l’aise avec le risque lié aux actions, capables de supporter une perte totale du capital, comprenant les produits structurés et prêts à conserver jusqu’à l’échéance ou au remboursement anticipé.
Die Royal Bank of Canada (RY) bietet fünfjährige Auto-Callable Contingent Coupon Barrier Notes an, die an den schlechtesten der Nasdaq-100, Russell 2000 und S&P 500 Indizes gekoppelt sind. Die unbesicherten Senior-Notes mit einem Nennwert von 1.000 USD zahlen nur dann einen bedingten Kupon von 9,50 % p.a. (2,375 % vierteljährlich), wenn an dem jeweiligen Beobachtungstag alle drei Indizes auf oder über 75 % ihres jeweiligen Anfangswerts schließen. Liegt ein Index unter der Schwelle, wird für dieses Quartal kein Kupon gezahlt, und ausgefallene Kupons werden nicht nachgezahlt.
Automatische Rückzahlungsmechanik: Ab dem vierten vierteljährlichen Beobachtungstag (2. Juli 2026) werden die Notes zum Nennwert plus dem aktuellen Kupon zurückgezahlt, wenn jeder Index auf oder über seinem Anfangswert liegt. Eine vorzeitige Rückzahlung verkürzt die Haltedauer und begrenzt die Erträge auf die bis zu diesem Rückzahlungstermin erhaltenen Kupons.
Kapitalschutz ist bedingt. Bei Fälligkeit (5. April 2030) erhalten Anleger: (i) den Nennwert plus den letzten Kupon, wenn der schlechteste Index mindestens 60 % seines Anfangswerts erreicht, oder (ii) einen Verlust entsprechend dem prozentualen Rückgang des schlechtesten Index, wenn dieser unter die 60 %-Barriere fällt (z. B. führt ein 50%iger Indexrückgang zu einer Rückzahlung von 500 USD pro 1.000 USD Note).
Das Angebot erfolgt zum Nennwert, aber der von RBC geschätzte anfängliche Wert liegt zwischen 927,50 und 957,50 USD, was einen Aufschlag von 4,3 % bis 7,3 % gegenüber dem fairen Wert aufgrund einer 1,00 % Underwriting-Gebühr, bis zu 10 USD Verkaufsprovision und Absicherungskosten widerspiegelt. Die Notes sind nicht börsennotiert; die Liquidität hängt vom Handel mit RBC ab und kann begrenzt sein, mit breiten Geld-Brief-Spannen.
Wesentliche Risiken umfassen: potenziellen Kapitalverlust, Möglichkeit, wenige oder keine Kupons zu erhalten, begrenztes Aufwärtspotenzial (keine Teilnahme an Indexgewinnen über die Kupons hinaus), Kreditrisiko gegenüber RBC, komplexe steuerliche Behandlung und Illiquidität. Die Multi-Index-„Worst-of“-Struktur bedeutet, dass die Performance vom schwächsten Index bestimmt wird, wodurch Diversifikationseffekte entfallen.
Zielinvestoren sind renditeorientierte Anleger, die mit aktienbezogenen Risiken vertraut sind, einen Totalverlust des Kapitals tolerieren können, strukturierte Produkte verstehen und bereit sind, bis zur Fälligkeit oder zum Rückruf zu halten.
- 9.50% annual contingent coupon provides high headline yield if index levels remain resilient.
- 60% barrier offers partial downside protection; investors are insulated from up to a 40% decline in the worst index at maturity.
- Quarterly automatic call feature can shorten duration and enhance annualized yield if markets perform well.
- Issued by Royal Bank of Canada, a highly rated global financial institution, reducing default risk relative to many structured note issuers.
- Principal risk: investors lose 1% of par for every 1% drop below the barrier, exposing them to substantial losses in bear markets.
- Coupon uncertainty: payments cease if any index closes below 75% of initial level on an observation date.
- No upside participation beyond fixed coupons, capping total return even if indices rally strongly.
- Worst-of basket effect increases probability of missed coupons and barrier breach, especially given RTY volatility.
- Liquidity and valuation drag: notes are not exchange-listed; initial estimated value is up to 7.3% below issue price, and secondary bid-ask spreads may be wide.
- Complex tax and withholding treatment, particularly for non-U.S. holders, may reduce net returns.
Insights
TL;DR: High 9.5% coupon attractive, but payoff is binary and worst-of basket plus 60% barrier leaves substantial downside.
The note offers above-market income versus plain-vanilla corporates, yet actual cash flow depends on quarterly index levels. Because coupons stop when any index falls below 75% of its start, income will likely vanish during equity drawdowns—precisely when protection is most needed. The 60% barrier provides 40% downside cushion, but the worst-of design ties principal return to the weakest segment; historically the Russell 2000 is far more volatile than the S&P 500, increasing the probability of a barrier breach. Investors also surrender all upside beyond coupons and face a 4-7% valuation drag at issuance. Overall I view the terms as yield-enhanced but risk-heavy, justifying a neutral impact rating.
TL;DR: Credit-linked, illiquid, and tax-complex; downside asymmetry outweighs limited upside for most risk profiles.
The notes are senior unsecured obligations of RBC—an AA- rated bank—so default probability is low, but market value is highly sensitive to volatility, correlation and funding spreads. The embedded short put on the worst index plus long digital call structure means delta can swing sharply negative in sell-offs, pressuring bid prices. With no exchange listing and only dealer markets, exit liquidity will be thin and subject to 3–5% bid-ask gaps. Initial price above internal fair value and the 30% withholding risk for non-US holders further erode expected return. From a risk-adjusted standpoint, the product is better suited for niche income strategies than core portfolios.
Royal Bank of Canada (RY) offre note a cinque anni Auto-Callable Contingent Coupon Barrier legate all'indice peggiore tra Nasdaq-100, Russell 2000 e S&P 500. Le note senior non garantite denominate $1.000 pagano un coupon condizionato del 9,50% annuo (2,375% trimestrale) solo se, alla data di osservazione, tutti e tre gli indici chiudono al 75% o più dei loro livelli iniziali. Se uno degli indici è sotto la soglia, il coupon per quel trimestre non viene pagato e i coupon saltati non sono recuperabili.
Meccanismo di richiamo automatico: a partire dalla quarta data di osservazione trimestrale (2 luglio 2026), le note saranno rimborsate a valore nominale più il coupon corrente se ogni indice è pari o superiore al livello iniziale. Il rimborso anticipato ridurrà il periodo di detenzione e limiterà i guadagni ai soli coupon ricevuti fino a quella data.
La protezione del capitale è condizionata. Alla scadenza (5 aprile 2030) gli investitori riceveranno: (i) il valore nominale più l’ultimo coupon se l’indice peggiore è almeno al 60% del livello iniziale, oppure (ii) una perdita proporzionale al calo percentuale dell’indice peggiore se questo scende sotto la barriera del 60% (ad esempio, un calo del 50% dell’indice comporta un rimborso di $500 per ogni nota da $1.000).
L’offerta è a valore nominale, ma il valore stimato iniziale di RBC è compreso tra
I rischi principali includono: possibile perdita del capitale, possibilità di ricevere pochi o nessun coupon, guadagni limitati (nessuna partecipazione ai rialzi degli indici oltre i coupon), rischio di credito verso RBC, trattamento fiscale complesso e illiquidità. La struttura multi-indice “worst-of” significa che la performance dipende dall’indice più debole, eliminando i benefici di diversificazione.
Gli investitori target sono conti orientati al rendimento, a loro agio con il rischio legato all’equity, disposti a tollerare una perdita totale del capitale, che comprendono i prodotti strutturati e sono disponibili a mantenere l’investimento fino alla scadenza o al richiamo.
Royal Bank of Canada (RY) está ofreciendo notas a cinco años Auto-Callable Contingent Coupon Barrier vinculadas al índice de peor desempeño entre Nasdaq-100, Russell 2000 y S&P 500. Las notas senior no aseguradas denominadas en $1,000 pagan un cupón contingente del 9.50% anual (2.375% trimestral) solo si, en la fecha de observación correspondiente, los tres índices cierran al 75% o más de sus niveles iniciales. Si algún índice está por debajo del umbral, no se paga cupón en ese trimestre y los cupones omitidos no se recuperan.
Mecánica de llamada automática: A partir de la cuarta fecha de observación trimestral (2 de julio de 2026), las notas serán redimidas al valor nominal más el cupón vigente si cada índice está en o por encima de su nivel inicial. La redención anticipada acortaría el período de tenencia y limitaría los ingresos a los cupones recibidos hasta esa fecha de llamada.
La protección del principal es condicional. Al vencimiento (5 de abril de 2030), los inversores recibirán: (i) el valor nominal más el cupón final si el índice de peor desempeño está al menos al 60% de su nivel inicial, o (ii) una pérdida equivalente al porcentaje de caída del índice peor si termina por debajo de la barrera del 60% (por ejemplo, una caída del 50% en el índice entrega $500 por cada nota de $1,000).
La oferta es a valor nominal, pero el valor estimado inicial de RBC es de
Los riesgos clave incluyen: posible pérdida del principal, posibilidad de recibir pocos o ningún cupón, rendimiento limitado (sin participación en las ganancias del índice más allá de los cupones), exposición crediticia a RBC, tratamiento fiscal complejo e iliquidez. La estructura multiíndice “worst-of” significa que el rendimiento está determinado por el índice más débil, eliminando los beneficios de diversificación.
Los inversores objetivo son cuentas orientadas al rendimiento cómodas con riesgo vinculado a acciones, que pueden tolerar la pérdida total del principal, entienden productos estructurados y están dispuestos a mantener hasta el vencimiento o llamada.
Royal Bank of Canada(RY)는 Nasdaq-100, Russell 2000, S&P 500 지수 중 최저 성과 지수에 연동된 5년 만기 Auto-Callable Contingent Coupon Barrier Notes를 마케팅하고 있습니다. $1,000 단위의 선순위 무담보 노트는 연 9.50%(분기별 2.375%)의 조건부 쿠폰을 지급하는데, 해당 관찰일에 세 지수 모두가 초기 수준의 75% 이상으로 마감해야 합니다. 하나라도 기준 이하일 경우 해당 분기 쿠폰은 지급되지 않으며, 미지급 쿠폰은 보전되지 않습니다.
자동 콜 메커니즘: 네 번째 분기 관찰일(2026년 7월 2일)부터 각 지수가 초기 수준 이상일 경우, 노트는 액면가와 현재 쿠폰과 함께 상환됩니다. 조기 상환 시 보유 기간이 단축되고 해당 콜일까지 받은 쿠폰까지만 수익이 한정됩니다.
원금 보호는 조건부입니다. 만기일(2030년 4월 5일)에 투자자는 (i) 최저 성과 지수가 초기 수준의 60% 이상일 경우 액면가와 최종 쿠폰을 받거나, (ii) 최저 지수 하락률만큼 손실을 입게 됩니다(예: 지수가 50% 하락하면 $1,000 노트당 $500 지급).
본 딜은 액면가로 제공되나, RBC의 초기 추정 가치는 $927.50~$957.50로, 1.00% 인수 수수료, 최대 $10 판매 수수료, 헤지 비용으로 인해 공정 가치 대비 4.3%-7.3% 프리미엄이 반영되어 있습니다. 노트는 상장되어 있지 않으며, 유동성은 RBC 거래에 따라 달라지고 제한적일 수 있으며, 매수-매도 스프레드가 넓을 수 있습니다.
주요 위험으로는 원금 손실 가능성, 쿠폰 수령 제한 또는 미지급, 제한된 상승 잠재력(쿠폰 외 지수 상승 참여 없음), RBC 신용 위험, 복잡한 세금 처리, 유동성 부족 등이 있습니다. 다중 지수 ‘최저 성과’ 구조는 가장 약한 지수가 성과를 좌우해 분산 효과가 사라집니다.
대상 투자자는 수익 지향 계좌로, 주식 연계 위험을 감내할 수 있고 원금 전액 손실을 견딜 수 있으며, 구조화 상품을 이해하고 만기 또는 콜까지 보유할 의향이 있는 투자자입니다.
La Royal Bank of Canada (RY) commercialise des billets à barrière à coupon contingent auto-remboursables sur cinq ans, liés à la performance la plus faible parmi les indices Nasdaq-100, Russell 2000 et S&P 500. Ces billets senior non sécurisés, libellés en 1 000 $, versent un coupon contingent de 9,50 % par an (2,375 % trimestriel) uniquement si, à la date d'observation concernée, les trois indices clôturent à 75 % ou plus de leurs niveaux initiaux. Si un indice est en dessous du seuil, aucun coupon n’est versé pour ce trimestre, et les coupons non versés ne sont pas rattrapés.
Mécanisme de remboursement automatique : À partir de la quatrième date d’observation trimestrielle (2 juillet 2026), les billets seront remboursés au pair plus le coupon courant si chaque indice est au moins égal à son niveau initial. Un remboursement anticipé réduirait la période de détention et limiterait les revenus aux coupons perçus jusqu’à cette date de remboursement.
La protection du capital est conditionnelle. À l’échéance (5 avril 2030), les investisseurs recevront : (i) le pair plus le coupon final si l’indice le plus faible est au moins à 60 % de son niveau initial, ou (ii) une perte correspondant à la baisse en pourcentage de l’indice le plus faible si celui-ci termine sous la barrière des 60 % (par exemple, une baisse de 50 % de l’indice entraîne un remboursement de 500 $ par billet de 1 000 $).
L’offre est proposée au pair, mais la valeur initiale estimée par RBC est comprise entre 927,50 $ et 957,50 $, ce qui reflète une prime de 4,3 % à 7,3 % par rapport à la juste valeur en raison de frais de souscription de 1,00 %, jusqu’à 10 $ de commission de vente et des coûts de couverture. Les billets ne sont pas cotés ; la liquidité dépendra des transactions de RBC et pourrait être limitée, avec des écarts acheteur-vendeur importants.
Les risques clés incluent : la perte potentielle du capital, la possibilité de recevoir peu ou pas de coupons, un potentiel limité à la hausse (pas de participation aux gains des indices au-delà des coupons), une exposition au crédit de RBC, une fiscalité complexe et une illiquidité. La structure multi-indices « worst-of » signifie que la performance est déterminée par l’indice le plus faible, éliminant les bénéfices de diversification.
Les investisseurs cibles sont des portefeuilles orientés rendement, à l’aise avec le risque lié aux actions, capables de supporter une perte totale du capital, comprenant les produits structurés et prêts à conserver jusqu’à l’échéance ou au remboursement anticipé.
Die Royal Bank of Canada (RY) bietet fünfjährige Auto-Callable Contingent Coupon Barrier Notes an, die an den schlechtesten der Nasdaq-100, Russell 2000 und S&P 500 Indizes gekoppelt sind. Die unbesicherten Senior-Notes mit einem Nennwert von 1.000 USD zahlen nur dann einen bedingten Kupon von 9,50 % p.a. (2,375 % vierteljährlich), wenn an dem jeweiligen Beobachtungstag alle drei Indizes auf oder über 75 % ihres jeweiligen Anfangswerts schließen. Liegt ein Index unter der Schwelle, wird für dieses Quartal kein Kupon gezahlt, und ausgefallene Kupons werden nicht nachgezahlt.
Automatische Rückzahlungsmechanik: Ab dem vierten vierteljährlichen Beobachtungstag (2. Juli 2026) werden die Notes zum Nennwert plus dem aktuellen Kupon zurückgezahlt, wenn jeder Index auf oder über seinem Anfangswert liegt. Eine vorzeitige Rückzahlung verkürzt die Haltedauer und begrenzt die Erträge auf die bis zu diesem Rückzahlungstermin erhaltenen Kupons.
Kapitalschutz ist bedingt. Bei Fälligkeit (5. April 2030) erhalten Anleger: (i) den Nennwert plus den letzten Kupon, wenn der schlechteste Index mindestens 60 % seines Anfangswerts erreicht, oder (ii) einen Verlust entsprechend dem prozentualen Rückgang des schlechtesten Index, wenn dieser unter die 60 %-Barriere fällt (z. B. führt ein 50%iger Indexrückgang zu einer Rückzahlung von 500 USD pro 1.000 USD Note).
Das Angebot erfolgt zum Nennwert, aber der von RBC geschätzte anfängliche Wert liegt zwischen 927,50 und 957,50 USD, was einen Aufschlag von 4,3 % bis 7,3 % gegenüber dem fairen Wert aufgrund einer 1,00 % Underwriting-Gebühr, bis zu 10 USD Verkaufsprovision und Absicherungskosten widerspiegelt. Die Notes sind nicht börsennotiert; die Liquidität hängt vom Handel mit RBC ab und kann begrenzt sein, mit breiten Geld-Brief-Spannen.
Wesentliche Risiken umfassen: potenziellen Kapitalverlust, Möglichkeit, wenige oder keine Kupons zu erhalten, begrenztes Aufwärtspotenzial (keine Teilnahme an Indexgewinnen über die Kupons hinaus), Kreditrisiko gegenüber RBC, komplexe steuerliche Behandlung und Illiquidität. Die Multi-Index-„Worst-of“-Struktur bedeutet, dass die Performance vom schwächsten Index bestimmt wird, wodurch Diversifikationseffekte entfallen.
Zielinvestoren sind renditeorientierte Anleger, die mit aktienbezogenen Risiken vertraut sind, einen Totalverlust des Kapitals tolerieren können, strukturierte Produkte verstehen und bereit sind, bis zur Fälligkeit oder zum Rückruf zu halten.
 |
Registration Statement No. 333-275898 Filed Pursuant to Rule 424(b)(2) |
| The information in this preliminary pricing supplement is not complete and may be changed. | |
|
Preliminary Pricing Supplement Subject to Completion: Dated July 1, 2025 Pricing Supplement dated July __, 2025 to the Prospectus dated December 20, 2023, the Prospectus Supplement dated December 20, 2023, the Underlying Supplement No. 1A dated May 16, 2024 and the Product Supplement No. 1A dated May 16, 2024 |
$
Royal Bank of Canada | |
Royal Bank of Canada is offering Auto-Callable Contingent Coupon Barrier Notes (the “Notes”) linked to the performance of the least performing of the Nasdaq-100 Index®, the Russell 2000® Index and the S&P 500® Index (each, an “Underlier”).
| · | Contingent Coupons — If the Notes have not been automatically called, investors will receive a Contingent Coupon on a quarterly Coupon Payment Date at a rate of 9.50% per annum if the closing value of each Underlier is greater than or equal to its Coupon Threshold (75% of its Initial Underlier Value) on the immediately preceding Coupon Observation Date. You may not receive any Contingent Coupons during the term of the Notes. |
| · | Call Feature — If, on any quarterly Call Observation Date beginning approximately one year following the Trade Date, the closing value of each Underlier is greater than or equal to its Initial Underlier Value, the Notes will be automatically called for 100% of their principal amount plus the Contingent Coupon otherwise due. No further payments will be made on the Notes. |
| · | Contingent Return of Principal at Maturity — If the Notes are not automatically called and the Final Underlier Value of the Least Performing Underlier is greater than or equal to its Barrier Value (60% of its Initial Underlier Value), at maturity, investors will receive the principal amount of their Notes plus any Contingent Coupon otherwise due. If the Notes are not automatically called and the Final Underlier Value of the Least Performing Underlier is less than its Barrier Value, at maturity, investors will lose 1% of the principal amount of their Notes for each 1% that the Final Underlier Value of the Least Performing Underlier is less than its Initial Underlier Value. |
| · | Any payments on the Notes are subject to our credit risk. |
| · | The Notes will not be listed on any securities exchange. |
CUSIP: 78017PDK4
Investing in the Notes involves a number of risks. See “Selected Risk Considerations” beginning on page P-8 of this pricing supplement and “Risk Factors” in the accompanying prospectus, prospectus supplement and product supplement.
None of the Securities and Exchange Commission (the “SEC”), any state securities commission or any other regulatory body has approved or disapproved of the Notes or passed upon the adequacy or accuracy of this pricing supplement. Any representation to the contrary is a criminal offense. The Notes will not constitute deposits insured by the Canada Deposit Insurance Corporation, the U.S. Federal Deposit Insurance Corporation or any other Canadian or U.S. governmental agency or instrumentality. The Notes are not bail-inable notes and are not subject to conversion into our common shares under subsection 39.2(2.3) of the Canada Deposit Insurance Corporation Act.
|
Per Note |
Total | |
| Price to public(1) | 100.00% | $ |
| Underwriting discounts and commissions(1) |
1.00% |
$ |
| Proceeds to Royal Bank of Canada | 99.00% | $ |
(1) We or one of our affiliates may pay varying selling concessions of up to $10.00 per $1,000 principal amount of Notes in connection with the distribution of the Notes to other registered broker-dealers. Certain dealers who purchase the Notes for sale to certain fee-based advisory accounts may forgo some or all of their underwriting discount or selling concessions. The public offering price for investors purchasing the Notes in these accounts may be between $990.00 and $1,000.00 per $1,000 principal amount of Notes. In addition, we or one of our affiliates may pay a broker-dealer that is not affiliated with us a referral fee of up to $10.00 per $1,000 principal amount of Notes. See “Supplemental Plan of Distribution (Conflicts of Interest)” below.
The initial estimated value of the Notes determined by us as of the Trade Date, which we refer to as the initial estimated value, is expected to be between $927.50 and $957.50 per $1,000 principal amount of Notes and will be less than the public offering price of the Notes. The final pricing supplement relating to the Notes will set forth the initial estimated value. The market value of the Notes at any time will reflect many factors, cannot be predicted with accuracy and may be less than this amount. We describe the determination of the initial estimated value in more detail below.
RBC Capital Markets, LLC
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
KEY TERMS
The information in this “Key Terms” section is qualified by any more detailed information set forth in this pricing supplement and in the accompanying prospectus, prospectus supplement, underlying supplement and product supplement.
| Issuer: | Royal Bank of Canada |
| Underwriter: | RBC Capital Markets, LLC (“RBCCM”) |
| Minimum Investment: | $1,000 and minimum denominations of $1,000 in excess thereof |
| Underliers: | The Nasdaq-100 Index® (the “NDX Index”), the Russell 2000® Index (the “RTY Index”) and the S&P 500® Index (the “SPX Index”) |
| Underlier | Bloomberg Ticker | Initial Underlier Value(1) | Coupon Threshold(2) | Barrier Value(3) | |
| NDX Index | NDX | ||||
| RTY Index | RTY | ||||
| SPX Index | SPX |
| (1) With respect to each Underlier, the closing value of that Underlier on the Trade Date | |
| (2) With respect to each Underlier, 75% of its Initial Underlier Value (rounded to two decimal places for the NDX Index and the SPX Index and rounded to three decimal places for the RTY Index) | |
| (3) With respect to each Underlier, 60% of its Initial Underlier Value (rounded to two decimal places for the NDX Index and the SPX Index and rounded to three decimal places for the RTY Index) | |
| Trade Date: | July 2, 2025 |
| Issue Date: | July 8, 2025 |
| Valuation Date:* | April 2, 2030 |
| Maturity Date:* | April 5, 2030 |
| Payment of Contingent Coupons: |
If the Notes have not been automatically called, investors will receive a Contingent Coupon on a Coupon Payment Date if the closing value of each Underlier is greater than or equal to its Coupon Threshold on the immediately preceding Coupon Observation Date. No Contingent Coupon will be payable on a Coupon Payment Date if the closing value of any Underlier is less than its Coupon Threshold on the immediately preceding Coupon Observation Date. Accordingly, you may not receive a Contingent Coupon on one or more Coupon Payment Dates during the term of the Notes. |
| Contingent Coupon: | If payable, $23.75 per $1,000 principal amount of Notes (corresponding to a rate of 2.375% per quarter or 9.50% per annum) |
| Call Feature: | If, on any Call Observation Date, the closing value of each Underlier is greater than or equal to its Initial Underlier Value, the Notes will be automatically called. Under these circumstances, investors will receive on the Call Settlement Date per $1,000 principal amount of Notes an amount equal to $1,000 plus the Contingent Coupon otherwise due. No further payments will be made on the Notes. |
| P-2 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
| Payment at Maturity: |
If the Notes are not automatically called, investors will receive on the Maturity Date per $1,000 principal amount of Notes, in addition to any Contingent Coupon otherwise due: · If the Final Underlier Value of the Least Performing Underlier is greater than or equal to its Barrier Value: $1,000 · If the Final Underlier Value of the Least Performing Underlier is less than its Barrier Value, an amount equal to: $1,000 + ($1,000 × Underlier Return of the Least Performing Underlier) If the Notes are not automatically called and the Final Underlier Value of the Least Performing Underlier is less than its Barrier Value, you will lose a substantial portion or all of your principal amount at maturity. All payments on the Notes are subject to our credit risk. |
| Underlier Return: |
With respect to each Underlier, the Underlier Return, expressed as a percentage, is calculated using the following formula: Final Underlier Value – Initial Underlier
Value |
| Final Underlier Value: | With respect to each Underlier, the closing value of that Underlier on the Valuation Date |
| Least Performing Underlier: | The Underlier with the lowest Underlier Return |
| Coupon Observation Dates:* | Quarterly, as set forth in the table below |
| Coupon Payment Dates:* | Quarterly, as set forth in the table below |
| Call Observation Dates:* | Quarterly, beginning approximately one year following the Trade Date, on each Coupon Observation Date from and including the fourth Coupon Observation Date, which is July 2, 2026 |
| Call Settlement Date:* | If the Notes are automatically called on any Call Observation Date, the Coupon Payment Date immediately following that Call Observation Date |
| Calculation Agent: | RBCCM |
| Coupon Observation Dates* | Coupon Payment Dates* |
| October 2, 2025 | October 7, 2025 |
| January 2, 2026 | January 7, 2026 |
| April 2, 2026 | April 8, 2026 |
| July 2, 2026 | July 8, 2026 |
| October 2, 2026 | October 7, 2026 |
| January 4, 2027 | January 7, 2027 |
| April 2, 2027 | April 7, 2027 |
| July 2, 2027 | July 8, 2027 |
| October 4, 2027 | October 7, 2027 |
| January 3, 2028 | January 6, 2028 |
| April 3, 2028 | April 6, 2028 |
| July 3, 2028 | July 7, 2028 |
| October 2, 2028 | October 5, 2028 |
| January 2, 2029 | January 5, 2029 |
| April 2, 2029 | April 5, 2029 |
| July 2, 2029 | July 6, 2029 |
| October 2, 2029 | October 5, 2029 |
| P-3 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
| Coupon Observation Dates* | Coupon Payment Dates* |
| January 2, 2030 | January 7, 2030 |
| April 2, 2030 (the Valuation Date) | April 5, 2030 (the Maturity Date) |
* Subject to postponement. See “General Terms of the Notes—Postponement of a Determination Date” and “General Terms of the Notes—Postponement of a Payment Date” in the accompanying product supplement.
| P-4 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
ADDITIONAL TERMS OF YOUR NOTES
You should read this pricing supplement together with the prospectus dated December 20, 2023, as supplemented by the prospectus supplement dated December 20, 2023, relating to our Senior Global Medium-Term Notes, Series J, of which the Notes are a part, the underlying supplement no. 1A dated May 16, 2024 and the product supplement no. 1A dated May 16, 2024. This pricing supplement, together with these documents, contains the terms of the Notes and supersedes all other prior or contemporaneous oral statements as well as any other written materials, including preliminary or indicative pricing terms, correspondence, trade ideas, structures for implementation, sample structures, fact sheets, brochures or other educational materials of ours.
We have not authorized anyone to provide any information or to make any representations other than those contained or incorporated by reference in this pricing supplement and the documents listed below. We take no responsibility for, and can provide no assurance as to the reliability of, any other information that others may give you. These documents are an offer to sell only the Notes offered hereby, but only under circumstances and in jurisdictions where it is lawful to do so. The information contained in each such document is current only as of its date.
If the information in this pricing supplement differs from the information contained in the documents listed below, you should rely on the information in this pricing supplement.
You should carefully consider, among other things, the matters set forth in “Selected Risk Considerations” in this pricing supplement and “Risk Factors” in the documents listed below, as the Notes involve risks not associated with conventional debt securities. We urge you to consult your investment, legal, tax, accounting and other advisers before you invest in the Notes.
You may access these documents on the SEC website at www.sec.gov as follows (or if such address has changed, by reviewing our filings for the relevant date on the SEC website):
| · | Prospectus dated December 20, 2023: |
https://www.sec.gov/Archives/edgar/data/1000275/000119312523299520/d645671d424b3.htm
| · | Prospectus Supplement dated December 20, 2023: |
https://www.sec.gov/Archives/edgar/data/1000275/000119312523299523/d638227d424b3.htm
| · | Underlying Supplement No. 1A dated May 16, 2024: |
https://www.sec.gov/Archives/edgar/data/1000275/000095010324006773/dp211259_424b2-us1a.htm
| · | Product Supplement No. 1A dated May 16, 2024: |
https://www.sec.gov/Archives/edgar/data/1000275/000095010324006777/dp211286_424b2-ps1a.htm
Our Central Index Key, or CIK, on the SEC website is 1000275. As used in this pricing supplement, “Royal Bank of Canada,” the “Bank,” “we,” “our” and “us” mean only Royal Bank of Canada.
| P-5 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
HYPOTHETICAL RETURNS
The table and examples set forth below illustrate hypothetical payments at maturity for hypothetical performance of the Least Performing Underlier, based on its Coupon Threshold of 75% of its Initial Underlier Value, its Barrier Value of 60% of its Initial Underlier Value and the Contingent Coupon of $23.75 per $1,000 principal amount of Notes. The table and examples below also assume that the Notes are not automatically called and do not account for any Contingent Coupons that may be paid prior to maturity. The table and examples are only for illustrative purposes and may not show the actual return applicable to investors.
| Hypothetical Underlier Return of the Least Performing Underlier | Payment at Maturity per $1,000 Principal Amount of Notes* | Payment at Maturity as Percentage of Principal Amount* |
| 50.00% | $1,023.75 | 102.375% |
| 40.00% | $1,023.75 | 102.375% |
| 30.00% | $1,023.75 | 102.375% |
| 20.00% | $1,023.75 | 102.375% |
| 10.00% | $1,023.75 | 102.375% |
| 5.00% | $1,023.75 | 102.375% |
| 0.00% | $1,023.75 | 102.375% |
| -5.00% | $1,023.75 | 102.375% |
| -10.00% | $1,023.75 | 102.375% |
| -20.00% | $1,023.75 | 102.375% |
| -25.00% | $1,023.75 | 102.375% |
| -25.01% | $1,000.00 | 100.000% |
| -30.00% | $1,000.00 | 100.000% |
| -35.00% | $1,000.00 | 100.000% |
| -40.00% | $1,000.00 | 100.000% |
| -40.01% | $599.90 | 59.990% |
| -50.00% | $500.00 | 50.000% |
| -60.00% | $400.00 | 40.000% |
| -70.00% | $300.00 | 30.000% |
| -80.00% | $200.00 | 20.000% |
| -90.00% | $100.00 | 10.000% |
| -100.00% | $0.00 | 0.000% |
* Including any Contingent Coupon otherwise due
| Example 1 — | The value of the Least Performing Underlier increases from its Initial Underlier Value to its Final Underlier Value by 30%. | |
| Underlier Return of the Least Performing Underlier: | 30% | |
| Payment at Maturity: | $1,000 + Contingent Coupon otherwise due = $1,000 + $23.75 = $1,023.75 | |
|
In this example, the payment at maturity is $1,023.75 per $1,000 principal amount of Notes. Because the Final Underlier Value of the Least Performing Underlier is greater than its Coupon Threshold and Barrier Value, investors receive a full return of the principal amount of their Notes plus the Contingent | ||
| P-6 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
| Coupon otherwise due. This example illustrates that investors do not participate in any appreciation of the Least Performing Underlier, which may be significant. |
| Example 2 — | The value of the Least Performing Underlier decreases from its Initial Underlier Value to its Final Underlier Value by 10% (i.e., its Final Underlier Value is below its Initial Underlier Value but above its Coupon Threshold and Barrier Value). | |
| Underlier Return of the Least Performing Underlier: | -10% | |
| Payment at Maturity: | $1,000 + Contingent Coupon otherwise due = $1,000 + $23.75 = $1,023.75 | |
|
In this example, the payment at maturity is $1,023.75 per $1,000 principal amount of Notes. Because the Final Underlier Value of the Least Performing Underlier is greater than its Coupon Threshold and Barrier Value, investors receive a full return of the principal amount of their Notes plus the Contingent Coupon otherwise due. | ||
| Example 3 — | The value of the Least Performing Underlier decreases from its Initial Underlier Value to its Final Underlier Value by 35% (i.e., its Final Underlier Value is below its Coupon Threshold but above its Barrier Value). | |
| Underlier Return of the Least Performing Underlier: | -35% | |
| Payment at Maturity: | $1,000 | |
|
In this example, the payment at maturity is $1,000 per $1,000 principal amount of Notes. Because the Final Underlier Value of the Least Performing Underlier is less than its Coupon Threshold but greater than its Barrier Value, investors receive a full return of the principal amount of their Notes but do not receive a Contingent Coupon at maturity. | ||
| Example 4 — | The value of the Least Performing Underlier decreases from its Initial Underlier Value to its Final Underlier Value by 50% (i.e., its Final Underlier Value is below its Coupon Threshold and Barrier Value). | |
| Underlier Return of the Least Performing Underlier: | -50% | |
| Payment at Maturity: | $1,000 + ($1,000 × -50%) = $1,000 – $500 = $500 | |
|
In this example, the payment at maturity is $500 per $1,000 principal amount of Notes, representing a loss of 50% of the principal amount. Because the Final Underlier Value of the Least Performing Underlier is less than its Barrier Value, investors do not receive a full return of the principal amount of their Notes. In addition, because the Final Underlier Value of the Least Performing Underlier is less than its Coupon Threshold, investors do not receive a Contingent Coupon at maturity. | ||
Investors in the Notes could lose a substantial portion or all of the principal amount of their Notes at maturity. The table and examples above assume that the Notes are not automatically called. However, if the Notes are automatically called, investors will not receive any further payments after the Call Settlement Date.
| P-7 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
SELECTED RISK CONSIDERATIONS
An investment in the Notes involves significant risks. We urge you to consult your investment, legal, tax, accounting and other advisers before you invest in the Notes. Some of the risks that apply to an investment in the Notes are summarized below, but we urge you to read also the “Risk Factors” sections of the accompanying prospectus, prospectus supplement and product supplement. You should not purchase the Notes unless you understand and can bear the risks of investing in the Notes.
Risks Relating to the Terms and Structure of the Notes
| · | You May Lose a Portion or All of the Principal Amount at Maturity — If the Notes are not automatically called and the Final Underlier Value of the Least Performing Underlier is less than its Barrier Value, you will lose 1% of the principal amount of your Notes for each 1% that the Final Underlier Value of the Least Performing Underlier is less than its Initial Underlier Value. You could lose a substantial portion or all of your principal amount at maturity. |
| · | You May Not Receive Any Contingent Coupons — We will not necessarily pay any Contingent Coupons on the Notes. If the closing value of any Underlier is less than its Coupon Threshold on a Coupon Observation Date, we will not pay you the Contingent Coupon applicable to that Coupon Observation Date. If the closing value of any Underlier is less than its Coupon Threshold on each of the Coupon Observation Dates, we will not pay you any Contingent Coupons during the term of, and you will not receive a positive return on, your Notes. Generally, this non-payment of the Contingent Coupon coincides with a greater risk of principal loss on your Notes. Even if your return is positive, your return may be less than the return you would earn if you purchased one of our conventional senior interest-bearing debt securities. |
| · | Any Payment on the Notes Will Be Determined Solely by the Performance of the Underlier with the Worst Performance Even If the Other Underliers Perform Better — Any payment on the Notes will be determined solely by the performance of the Underlier with the worst performance. The Notes are not linked to a weighted basket, in which the risk may be mitigated and diversified among each of the basket components. In the case of the Notes, the individual performance of the Underliers will not be combined, and the adverse performance of one Underlier will not be mitigated by any appreciation of any other Underlier. The Underliers may be uncorrelated and may not perform similarly over the term of the Notes, which may adversely affect your return on the Notes. |
| · | You Will Not Participate in Any Appreciation of Any Underlier, and Any Potential Return on the Notes Is Limited — The return on the Notes is limited to the Contingent Coupons, if any, that may be payable on the Notes, regardless of any appreciation of any Underlier, which may be significant. As a result, the return on an investment in the Notes could be less than the return on a direct investment in any Underlier. |
| · | The Notes Are Subject to an Automatic Call — If, on any Call Observation Date, the closing value of each Underlier is greater than or equal to its Initial Underlier Value, the Notes will be automatically called, and you will not receive any further payments on the Notes. Because the Notes could be called as early as approximately one year after the Issue Date, the total return on the Notes could be minimal. You may be unable to reinvest your proceeds from the automatic call in an investment with a return that is as high as the return on the Notes would have been if they had not been called. |
| · | Payments on the Notes Are Subject to Our Credit Risk, and Market Perceptions about Our Creditworthiness May Adversely Affect the Market Value of the Notes — The Notes are our senior unsecured debt securities, and your receipt of any amounts due on the Notes is dependent upon our ability to pay our obligations as they come due. If we were to default on our payment obligations, you may not receive any amounts owed to you under the Notes and you could lose your entire investment. In addition, any negative changes in market perceptions about our creditworthiness may adversely affect the market value of the Notes. |
| · | Any Payment on the Notes Will Be Determined Based on the Closing Values of the Underliers on the Dates Specified — Any payment on the Notes will be determined based on the closing values of the Underliers on the dates specified. You will not benefit from any more favorable values of the Underliers determined at any other time. |
| P-8 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
| · | The U.S. Federal Income Tax Consequences of an Investment in the Notes Are Uncertain — There is no direct legal authority regarding the proper U.S. federal income tax treatment of the Notes, and significant aspects of the tax treatment of the Notes are uncertain. Moreover, non-U.S. investors should note that persons having withholding responsibility in respect of the Notes may withhold on any coupon paid to a non-U.S. investor, generally at a rate of 30%. We will not pay any additional amounts in respect of such withholding. You should review carefully the section entitled “United States Federal Income Tax Considerations” herein, in combination with the section entitled “United States Federal Income Tax Considerations” in the accompanying product supplement, and consult your tax adviser regarding the U.S. federal income tax consequences of an investment in the Notes. |
Risks Relating to the Initial Estimated Value of the Notes and the Secondary Market for the Notes
| · | There May Not Be an Active Trading Market for the Notes; Sales in the Secondary Market May Result in Significant Losses — There may be little or no secondary market for the Notes. The Notes will not be listed on any securities exchange. RBCCM and our other affiliates may make a market for the Notes; however, they are not required to do so and, if they choose to do so, may stop any market-making activities at any time. Because other dealers are not likely to make a secondary market for the Notes, the price at which you may be able to trade your Notes is likely to depend on the price, if any, at which RBCCM or any of our other affiliates is willing to buy the Notes. Even if a secondary market for the Notes develops, it may not provide enough liquidity to allow you to easily trade or sell the Notes. We expect that transaction costs in any secondary market would be high. As a result, the difference between bid and ask prices for your Notes in any secondary market could be substantial. If you sell your Notes before maturity, you may have to do so at a substantial discount from the price that you paid for them, and as a result, you may suffer significant losses. The Notes are not designed to be short-term trading instruments. Accordingly, you should be able and willing to hold your Notes to maturity. |
| · | The Initial Estimated Value of the Notes Will Be Less Than the Public Offering Price — The initial estimated value of the Notes will be less than the public offering price of the Notes and does not represent a minimum price at which we, RBCCM or any of our other affiliates would be willing to purchase the Notes in any secondary market (if any exists) at any time. If you attempt to sell the Notes prior to maturity, their market value may be lower than the price you paid for them and the initial estimated value. This is due to, among other things, changes in the values of the Underliers, the internal funding rate we pay to issue securities of this kind (which is lower than the rate at which we borrow funds by issuing conventional fixed rate debt) and the inclusion in the public offering price of the underwriting discount, the referral fee, our estimated profit and the estimated costs relating to our hedging of the Notes. These factors, together with various credit, market and economic factors over the term of the Notes, are expected to reduce the price at which you may be able to sell the Notes in any secondary market and will affect the value of the Notes in complex and unpredictable ways. Assuming no change in market conditions or any other relevant factors, the price, if any, at which you may be able to sell your Notes prior to maturity may be less than your original purchase price, as any such sale price would not be expected to include the underwriting discount, the referral fee, our estimated profit or the hedging costs relating to the Notes. In addition, any price at which you may sell the Notes is likely to reflect customary bid-ask spreads for similar trades. In addition to bid-ask spreads, the value of the Notes determined for any secondary market price is expected to be based on a secondary market rate rather than the internal funding rate used to price the Notes and determine the initial estimated value. As a result, the secondary market price will be less than if the internal funding rate were used. |
| · | The Initial Estimated Value of the Notes Is Only an Estimate, Calculated as of the Trade Date — The initial estimated value of the Notes is based on the value of our obligation to make the payments on the Notes, together with the mid-market value of the derivative embedded in the terms of the Notes. See “Structuring the Notes” below. Our estimate is based on a variety of assumptions, including our internal funding rate (which represents a discount from our credit spreads), expectations as to dividends, interest rates and volatility and the expected term of the Notes. These assumptions are based on certain forecasts about future events, which may prove to be incorrect. Other entities may value the Notes or similar securities at a price that is significantly different than we do. |
The value of the Notes at any time after the Trade Date will vary based on many factors, including changes in market conditions, and cannot be predicted with accuracy. As a result, the actual value you would receive if you sold the Notes in any secondary market, if any, should be expected to differ materially from the initial estimated value of the Notes.
| P-9 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
Risks Relating to Conflicts of Interest and Our Trading Activities
| · | Our and Our Affiliates’ Business and Trading Activities May Create Conflicts of Interest — You should make your own independent investigation of the merits of investing in the Notes. Our and our affiliates’ economic interests are potentially adverse to your interests as an investor in the Notes due to our and our affiliates’ business and trading activities, and we and our affiliates have no obligation to consider your interests in taking any actions that might affect the value of the Notes. Trading by us and our affiliates may adversely affect the values of the Underliers and the market value of the Notes. See “Risk Factors—Risks Relating to Conflicts of Interest” in the accompanying product supplement. |
| · | RBCCM’s Role as Calculation Agent May Create Conflicts of Interest — As Calculation Agent, our affiliate, RBCCM, will determine any values of the Underliers and make any other determinations necessary to calculate any payments on the Notes. In making these determinations, the Calculation Agent may be required to make discretionary judgments, including those described under “—Risks Relating to the Underliers” below. In making these discretionary judgments, the economic interests of the Calculation Agent are potentially adverse to your interests as an investor in the Notes, and any of these determinations may adversely affect any payments on the Notes. The Calculation Agent will have no obligation to consider your interests as an investor in the Notes in making any determinations with respect to the Notes. |
Risks Relating to the Underliers
| · | You Will Not Have Any Rights to the Securities Included in Any Underlier — As an investor in the Notes, you will not have voting rights or rights to receive dividends or other distributions or any other rights with respect to the securities included in any Underlier. Each Underlier is a price return index and its return does not reflect regular cash dividends paid by its components. |
| · | The Notes Are Subject to Small-Capitalization Companies Risk with Respect to the RTY Index — The RTY Index tracks securities issued by companies with relatively small market capitalizations. These companies often have greater stock price volatility, lower trading volume and less liquidity than large-capitalization companies. As a result, the value of the RTY Index may be more volatile than that of a market measure that does not track solely small-capitalization stocks. Stock prices of small-capitalization companies are also generally more vulnerable than those of large-capitalization companies to adverse business and economic developments, and the stocks of small-capitalization companies may be thinly traded and may be less attractive to many investors if they do not pay dividends. In addition, small-capitalization companies are often less well-established and less stable financially than large-capitalization companies and may depend on a small number of key personnel, making them more vulnerable to loss of personnel. Small-capitalization companies are often subject to less analyst coverage and may be in early, and less predictable, periods of their corporate existences. Small-capitalization companies tend to have lower revenues, less diverse product lines, smaller shares of their target markets, fewer financial resources and fewer competitive strengths than large-capitalization companies. These companies may also be more susceptible to adverse developments related to their products or services. |
| · | The Notes Are Subject to Risks Relating to Non-U.S. Securities with Respect to the NDX Index — Because some of the equity securities composing the NDX Index are issued by non-U.S. issuers, an investment in the Notes involves risks associated with the home countries of those issuers. The prices of securities of non-U.S. companies may be affected by political, economic, financial and social factors in those countries, or global regions, including changes in government, economic and fiscal policies and currency exchange laws. |
| · | We May Accelerate the Notes If a Change-in-Law Event Occurs — Upon the occurrence of legal or regulatory changes that may, among other things, prohibit or otherwise materially restrict persons from holding the Notes or an Underlier or its components, or engaging in transactions in them, the Calculation Agent may determine that a change-in-law-event has occurred and accelerate the Maturity Date for a payment determined by the Calculation Agent in its sole discretion. Any amount payable upon acceleration could be significantly less than any amount that would be due on the Notes if they were not accelerated. However, if the Calculation Agent elects not to accelerate the Notes, the value of, and any amount payable on, the Notes could be adversely affected, perhaps significantly, by the occurrence of such legal or regulatory changes. See “General Terms of Notes—Change-in-Law Events” in the accompanying product supplement. |
| P-10 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
| · | Any Payment on the Notes May Be Postponed and Adversely Affected by the Occurrence of a Market Disruption Event — The timing and amount of any payment on the Notes is subject to adjustment upon the occurrence of a market disruption event affecting an Underlier. If a market disruption event persists for a sustained period, the Calculation Agent may make a determination of the closing value of any affected Underlier. See “General Terms of the Notes—Indices—Market Disruption Events,” “General Terms of the Notes—Postponement of a Determination Date” and “General Terms of the Notes—Postponement of a Payment Date” in the accompanying product supplement. |
| · | Adjustments to an Underlier Could Adversely Affect Any Payments on the Notes — The sponsor of an Underlier may add, delete, substitute or adjust the securities composing that Underlier or make other methodological changes to that Underlier that could affect its performance. The Calculation Agent will calculate the value to be used as the closing value of an Underlier in the event of certain material changes in, or modifications to, that Underlier. In addition, the sponsor of an Underlier may also discontinue or suspend calculation or publication of that Underlier at any time. Under these circumstances, the Calculation Agent may select a successor index that the Calculation Agent determines to be comparable to the discontinued Underlier or, if no successor index is available, the Calculation Agent will determine the value to be used as the closing value of that Underlier. Any of these actions could adversely affect the value of an Underlier and, consequently, the value of the Notes. See “General Terms of the Notes—Indices—Discontinuation of, or Adjustments to, an Index” in the accompanying product supplement. |
| P-11 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
INFORMATION REGARDING THE UNDERLIERS
The NDX Index is a modified market capitalization-weighted index that is designed to measure the performance of 100 of the largest non-financial companies listed on The Nasdaq Stock Market. For more information about the NDX Index, see “Indices—The Nasdaq-100 Index®” in the accompanying underlying supplement.
The RTY Index measures the capitalization-weighted price performance of 2,000 U.S. small-capitalization stocks listed on eligible U.S. exchanges and is designed to track the performance of the small-capitalization segment of the U.S. equity market. For more information about the RTY Index, see “Indices—The Russell Indices” in the accompanying underlying supplement.
The SPX Index consists of stocks of 500 companies selected to provide a performance benchmark for the U.S. equity markets. For more information about the SPX Index, see “Indices—The S&P U.S. Indices” in the accompanying underlying supplement.
Historical Information
The following graphs set forth historical closing values of the Underliers for the period from January 1, 2015 to June 27, 2025. Each red line represents a hypothetical Coupon Threshold and each green line represents a hypothetical Barrier Value, in each case based on the closing value of the relevant Underlier on June 27, 2025. We obtained the information in the graphs from Bloomberg Financial Markets, without independent investigation. We cannot give you assurance that the performance of the Underliers will result in the return of all of your initial investment.
Nasdaq-100 Index®
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.
| P-12 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
Russell 2000® Index
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.
| P-13 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
S&P 500® Index
PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS.
| P-14 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS
You should review carefully the section in the accompanying product supplement entitled “United States Federal Income Tax Considerations.” The following discussion, when read in combination with that section, constitutes the full opinion of our counsel, Davis Polk & Wardwell LLP, regarding the material U.S. federal income tax consequences of owning and disposing of the Notes.
Generally, this discussion assumes that you purchased the Notes for cash in the original issuance at the stated issue price and does not address other circumstances specific to you, including consequences that may arise due to any other investments relating to the Underliers. You should consult your tax adviser regarding the effect any such circumstances may have on the U.S. federal income tax consequences of your ownership of a Note.
In the opinion of our counsel, which is based on current market conditions, it is reasonable to treat the Notes for U.S. federal income tax purposes as prepaid financial contracts with associated coupons, and any coupons as ordinary income, as described in the section entitled “United States Federal Income Tax Considerations—Tax Consequences to U.S. Holders—Notes Treated as Prepaid Financial Contracts with Associated Coupons” in the accompanying product supplement. There is uncertainty regarding this treatment, and the Internal Revenue Service (the “IRS”) or a court might not agree with it. Moreover, because this treatment of the Notes and our counsel’s opinion are based on market conditions as of the date of this preliminary pricing supplement, each is subject to confirmation on the Trade Date. A different tax treatment could be adverse to you.
We do not plan to request a ruling from the IRS regarding the treatment of the Notes. An alternative characterization of the Notes could materially and adversely affect the tax consequences of ownership and disposition of the Notes, including the timing and character of income recognized. In addition, the U.S. Treasury Department and the IRS have requested comments on various issues regarding the U.S. federal income tax treatment of “prepaid forward contracts” and similar financial instruments and have indicated that such transactions may be the subject of future regulations or other guidance. Furthermore, members of Congress have proposed legislative changes to the tax treatment of derivative contracts. Any legislation, Treasury regulations or other guidance promulgated after consideration of these issues could materially and adversely affect the tax consequences of an investment in the Notes, possibly with retroactive effect.
Non-U.S. Holders. The U.S. federal income tax treatment of the coupons is unclear. To the extent that we have withholding responsibility in respect of the Notes, we would expect generally to treat the coupons as subject to U.S. withholding tax. Moreover, you should expect that, if the applicable withholding agent determines that withholding tax should apply, it will be at a rate of 30% (or lower treaty rate). In order to claim an exemption from, or a reduction in, the 30% withholding under an applicable treaty, you may need to comply with certification requirements to establish that you are not a U.S. person and are eligible for such an exemption or reduction under an applicable tax treaty. You should consult your tax adviser regarding the tax treatment of the coupons.
As discussed under “United States Federal Income Tax Considerations—Tax Consequences to Non-U.S. Holders—Dividend Equivalents under Section 871(m) of the Code” in the accompanying product supplement, Section 871(m) of the Internal Revenue Code and Treasury regulations promulgated thereunder (“Section 871(m)”) generally impose a 30% withholding tax on dividend equivalents paid or deemed paid to Non-U.S. Holders with respect to certain financial instruments linked to U.S. equities or indices that include U.S. equities. The Treasury regulations, as modified by an IRS notice, exempt financial instruments issued prior to January 1, 2027 that do not have a “delta” of one. Based on certain determinations made by us, we expect that Section 871(m) will not apply to the Notes with regard to Non-U.S. Holders. Our determination is not binding on the IRS, and the IRS may disagree with this determination. If necessary, further information regarding the potential application of Section 871(m) will be provided in the final pricing supplement for the Notes.
We will not be required to pay any additional amounts with respect to U.S. federal withholding taxes.
You should consult your tax adviser regarding the U.S. federal income tax consequences of an investment in the Notes, including possible alternative treatments, as well as tax consequences arising under the laws of any state, local or non-U.S. taxing jurisdiction.
| P-15 | RBC Capital Markets, LLC |
| Auto-Callable Contingent Coupon Barrier Notes Linked to the Least Performing of Three Underliers |
SUPPLEMENTAL PLAN OF DISTRIBUTION (CONFLICTS OF INTEREST)
The Notes are offered initially to investors at a purchase price equal to par, except with respect to certain accounts as indicated on the cover page of this pricing supplement. We or one of our affiliates may pay the underwriting discount and may pay a broker-dealer that is not affiliated with us a referral fee, in each case as set forth on the cover page of this pricing supplement.
The value of the Notes shown on your account statement may be based on RBCCM’s estimate of the value of the Notes if RBCCM or another of our affiliates were to make a market in the Notes (which it is not obligated to do). That estimate will be based on the price that RBCCM may pay for the Notes in light of then-prevailing market conditions, our creditworthiness and transaction costs. For a period of approximately nine months after the Issue Date, the value of the Notes that may be shown on your account statement may be higher than RBCCM’s estimated value of the Notes at that time. This is because the estimated value of the Notes will not include the underwriting discount, the referral fee or our hedging costs and profits; however, the value of the Notes shown on your account statement during that period may initially be a higher amount, reflecting the addition of the underwriting discount, the referral fee and our estimated costs and profits from hedging the Notes. This excess is expected to decrease over time until the end of this period. After this period, if RBCCM repurchases your Notes, it expects to do so at prices that reflect their estimated value.
RBCCM or another of its affiliates or agents may use this pricing supplement in the initial sale of the Notes. In addition, RBCCM or another of our affiliates may use this pricing supplement in a market-making transaction in the Notes after their initial sale. Unless we or our agent informs the purchaser otherwise in the confirmation of sale, this pricing supplement is being used in a market-making transaction.
For additional information about the settlement cycle of the Notes, see “Plan of Distribution” in the accompanying prospectus. For additional information as to the relationship between us and RBCCM, see the section “Plan of Distribution—Conflicts of Interest” in the accompanying prospectus.
STRUCTURING THE NOTES
The Notes are our debt securities. As is the case for all of our debt securities, including our structured notes, the economic terms of the Notes reflect our actual or perceived creditworthiness. In addition, because structured notes result in increased operational, funding and liability management costs to us, we typically borrow the funds under structured notes at a rate that is lower than the rate that we might pay for a conventional fixed or floating rate debt security of comparable maturity. The lower internal funding rate, the underwriting discount, the referral fee and the hedging-related costs relating to the Notes reduce the economic terms of the Notes to you and result in the initial estimated value for the Notes being less than their public offering price. Unlike the initial estimated value, any value of the Notes determined for purposes of a secondary market transaction may be based on a secondary market rate, which may result in a lower value for the Notes than if our initial internal funding rate were used.
In order to satisfy our payment obligations under the Notes, we may choose to enter into certain hedging arrangements (which may include call options, put options or other derivatives) with RBCCM and/or one of our other subsidiaries. The terms of these hedging arrangements take into account a number of factors, including our creditworthiness, interest rate movements, volatility and the tenor of the Notes. The economic terms of the Notes and the initial estimated value depend in part on the terms of these hedging arrangements.
See “Selected Risk Considerations—Risks Relating to the Initial Estimated Value of the Notes and the Secondary Market for the Notes—The Initial Estimated Value of the Notes Will Be Less Than the Public Offering Price” above.
| P-16 | RBC Capital Markets, LLC |
FAQ
What is the coupon rate on RBC's (RY) Auto-Callable Contingent Coupon Barrier Notes?
How does the automatic call feature work for the RY 424B2 notes?
What principal protection do investors have on these RBC barrier notes?
Why is the initial estimated value (IEV) below the $1,000 issue price?
Are the RY Auto-Callable Notes liquid?
