*

RBC second quarter earnings per share C$3.12 vs forecast

C$3.19

*

CIBC second quarter earnings per share C$2.05 vs forecast

C$1.89

*

Both banks set aside more than expected for possible loan

losses

May 29 (Reuters) - Royal Bank of Canada ( RY ) on

Thursday missed analysts' quarterly profit estimates as loan

loss provisions jumped and a slowdown in dealmaking in the

United States hurt its capital markets business.

The miss is RBC's first in two years and contrasts with peer

Canadian Imperial Bank of Commerce ( CM ), which topped

estimates as its earnings from capital markets rose 20%.

Both banks, however, set aside more funds than anticipated

to cover potential loan defaults, as a changing economic outlook

is expected to lead to more caution among borrowers.

RBC, like some of its peers, has made a push into the United

States, seeking growth opportunities away from home, where it

has tightened its grip as the largest lender with the C$13.5

billion acquisition of HSBC Canada last year.

The capital markets unit, RBC's second largest income

generator, saw a 5% fall in net income, hurt by lower fixed

income trading and lower M&A activity in the United States.

At CIBC, that unit saw a 20% jump in earnings, helped by

higher financing and trading revenue.

"CIBC reported a good set of results ... credit continued to

outperform peers with a group-low PCL (provision for credit

losses) ratio on impaired loans this quarter," Scotiabank

analyst Mike Rizvanovic said.

RBC's provision for credit losses jumped 55% to C$1.42

billion in the second quarter, higher than analysts' estimate of

C$1.13 billion, according to LSEG data.

Adjusted profit rose 8% to C$4.53 billion ($3.28 billion).

On a per share basis, RBC earned C$3.12, missing the estimated

C$3.19.

CIBC's provisions rose C$91 million to C$605 million,

compared with an estimated C$601 million. Earnings of C$2.05 per

share surpassed analysts' average estimate of C$1.89.

RBC and CIBC wrap up second quarter earnings for Canada's

six big banks, which saw a marked rise in loan loss reserves as

they prepare for the economic impact of U.S. tariffs and a

global trade war.

($1 = 1.3821 Canadian dollars)