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NATIONAL CONSUMER CONFIDENCE PLUMMETS – AND SOUTHEAST CONFIDENCE SINKS DEEPER

OUTLOOK FALLS TO ALL-TIME LOW SINCE 2002 INDEX LAUNCH


RALEIGH, N.C. – Jan. 7, 2009 – With the implosion of Wall Street, the potential collapse of several Detroit automakers and escalating job-loss numbers, it’s not surprising that American consumers have a bleak attitude about their economic conditions and prospects. However, Southeastern attitudes, which are typically more positive than the rest of the nation, fell more than ever and now rest below the national average, according to the RBC Southeastern CASH Index (Consumer Attitudes and Spending by Household) commissioned by RBC Bank.

A year ago, the overall RBC CASH Index for the Southeast rested at 79.9, still slightly above the national average of 75.8. At the end of 2008, the CASH Index stands at 24.8 – compared to 31.0 seen nationwide. This represents the lowest consumer confidence level over a six-month period since the RBC CASH Index launched in January 2002. The RBC CASH Index is benchmarked against a baseline score of 100, assigned when the Index was introduced.

The most significant drop in the Southeast is around perceptions of current conditions, which stands at 24.0, down from 102.1 a year ago. There was also a downturn in positive evaluations of expectations for the future, decreasing from 23.8 for the second half of 2007 to -1.2 for the second half of 2008.

“It’s surprising to see the Southeast’s consumer confidence fall below the national average, since Southeasterners typically have a more positive attitude toward the economy than the rest of the nation,” said Joseph Keating, head of Private Asset Management for RBC Bank. “Entering a recession certainly plays a part in explaining recent confidence trends overall, as well as less confident perceptions about the future.”

Other RBC Southeastern CASH Index findings include:

  • Southeastern residents’ have some of the bleakest expectations for their economic future causing the RBC Expectations Index to fall into negative numbers at -1.2. While consumers in Virginia are particularly worried about their pocketbooks with 21 percent believing their personal finances will weaken over the next six months, residents in Florida and South Carolina are somewhat optimistic about their communities with 34 percent and 39 percent respectively saying the community finances will strengthen over the next six months.
  • Job security also fell in the Southeast. The RBC Southeastern Jobs Index stands at 68.2, compared to 117.2 this time last year.
    • North Carolina and Florida residents are the most concerned about their job security with 70 percent and 69 percent respectively reporting that they are less confident in their job security compared to six months ago.
    • Job losses are most severe in Georgia, where 60 percent of consumers say someone in their circle has experienced job losses in the last six months. More than half of consumers in Florida, North Carolina and South Carolina also report job losses in their circle.
    • North Carolinians are most concerned about future job losses with 35 percent thinking it is likely they will face job losses in the next six months.
  • Consumer opinion in the Southeast regarding investments also dropped more than 60 points to 34.8 for the July-December 2008 period.

“There’s no doubt that there are significant fluctuations in consumer opinions across the Southeast, and we will continue to monitor the short- and long-term effects of the change in confidence,” said Scott Custer, RBC Bank chairman and CEO. “However, we know the Southeast is a great place to do business, and we’re committed to helping our clients work through their uncertainties by continuing to show the strength and stability of a century-long financial institution.”

The RBC CASH Index is a composite measure of national consumer attitudes toward the state of local economies, personal financial situations, savings and investment, and job security. The recent six-month analysis includes a focused look at the Southeast where RBC Bank serves clients through its retail and commercial banking network.

About RBC Bank
RBC Bank, headquartered in Raleigh, N.C., offers a wide range of financial services and advice to individuals, businesses and public institutions throughout the Southeast. RBC Bank’s network includes more than 430 full-service banking centers, an extensive ATM network and telephone and online banking. RBC Bank is the 40th largest U.S. bank by consolidated assets, according to the Federal Reserve Statistical Release June 30, 2008. RBC Bank is a wholly-owned subsidiary of Royal Bank of Canada (RBC) (RY on the TSX and NYSE), Canada's largest and most stable bank as measured by assets and market capitalization. Global Finance Magazine named RBC the best bank in Canada in October 2008, and the safest bank in Canada for 10 consecutive years, from 1999-2008. RBC is also one of the world’s financial, social and environmental corporate leaders for the past eight years as on the Dow Jones Sustainability World Index. Additional information about RBC Bank may e found at www.rbcbankusa.com.

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For more information:
Jamie Mitchell/RBC Bank
Manager, Media Relations
919-788-5613
jamie.mitchell@rbc.com