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Business Context and Reporting Period

Reporting Manager: Royal Bank of Canada (RBC)
Filing Type: Form 13F-HR (Combination Report)
Reporting Period: Quarter Ended March 31, 2006
Submission Date: May 15, 2006
Scope: This is a combination report covering a portion of RBC's holdings. Other affiliated managers (including Voyageur Asset Management, RBC Dain Rauscher, and RBC Capital Markets) filed separate reports for the remaining holdings. The report includes 1,388 entries.

Key Financial Metrics

Total Reported Value: US $9,579,049,000 (approx. $9.58 billion)
Number of Holdings: 1,388 entries
Asset Composition: The portfolio is heavily weighted toward large-cap equities, including significant positions in Canadian financials (e.g., Toronto-Dominion Bank, Bank of Nova Scotia), technology (Microsoft, Cisco), and energy (Exxon Mobil, Suncor Energy). The filing also includes substantial holdings in Exchange Traded Funds (ETFs), particularly iShares and SPDRs tracking global indices.

Material Changes and Portfolio Composition

Top Sector Exposures:

• Financials: Significant ownership in major North American and Canadian banks (RBC, TD Bank, Scotiabank, Bank of Montreal, Wells Fargo, Citigroup).
• Technology: Large positions in Microsoft, Cisco Systems, Intel, and Oracle.
• Energy: Heavy allocation to Exxon Mobil, Suncor Energy, and TransCanada.
• Healthcare: Notable holdings in Pfizer, Johnson & Johnson, and Merck.

Voting Authority: The report distinguishes between "Sole," "Shared," and "None" voting authority. Many large positions (e.g., Microsoft, Cisco, TD Bank) are split between sole and shared authority, indicating complex ownership structures or client mandates.

Guidance, Risks, and Contingencies

Reporting Limitations (Risk): The filing explicitly states that certain Section 13(f) securities beneficially owned by trust accounts are not included. This exclusion is due to affiliated persons serving as trustees and third-party custodians failing to provide timely electronic data for aggregation. Management notes this issue is being addressed.
Management Commentary: As a 13F filing, this document contains no forward-looking guidance, earnings outlook, or strategic commentary. It is a statutory disclosure of holdings only.
Unusual Items: The report lists several holdings with "W EXP" (Warrants Expired) or specific expiration dates, indicating the presence of derivative instruments or warrants that may have matured or are nearing maturity.

Key Facts for Investor Verification

• Partial Reporting: Verify total exposure by aggregating this report with filings from the 15 other listed managers (e.g., Voyageur Asset Management, RBC Capital Markets) to get the full picture of RBC's managed assets.
• Trust Account Exclusion: Be aware that the reported $9.58 billion does not include assets held in specific trust accounts where data aggregation was not possible.
• Concentration Risk: The portfolio shows high concentration in the financial and energy sectors, particularly within North American and Canadian markets.
• ETF Usage: A significant portion of the portfolio is held via ETFs (iShares, SPDRs), suggesting a passive or index-tracking strategy for a large segment of the assets.