--- title: "Is Royal Bank of Canada Stock Halal?" canonical: https://www.halalwallet.ca/is-it-halal/royal-bank-of-canada-stock publisher: HalalWallet license: CC BY 4.0 verdict: not_halal verdict_label: Not Halal entity_type: stock ticker: RY.TO exchange: TSX last_reviewed: 2026-06-14 data_as_of: 2026-04-30 --- # Is Royal Bank of Canada Stock Halal? **Verdict: Not Halal** (Not permissible) Royal Bank of Canada (RY.TO) does not pass Shariah screening: its core business fails the activity screen (RBC's core business is conventional interest-based banking), and interest-bearing debt / market cap is 100.7% against the < 30% limit (data as of 2026-04-30), and impermissible income / total revenue is 75.6% against the < 5% limit (data as of 2026-04-30). It is not held by Shariah-screened ETFs WSHR. Screened alternatives exist in the same sector — see the halal stock screeners and ETF guides below. > HalalWallet is not a Shariah authority and does not issue religious rulings. We compile the most complete public record of what Shariah scholars, screening authorities, and mainstream standards say — reproduced from primary sources with dates and citations — and let you decide. ## How we read the evidence Royal Bank of Canada is the textbook example of a stock that fails Shariah screening at the first step, before any financial ratios are even calculated. RBC is a conventional bank: its business is taking deposits and lending money at interest. In fiscal 2025, net interest income was $33.0 billion out of $66.6 billion in total revenue, roughly half of everything the bank earned, and the other half came largely from conventional financial services such as insurance, capital markets, and wealth management. Under the AAOIFI-style business-activity screen used by most scholars and screening apps, a company whose core business is interest-based lending is excluded outright, regardless of how small or large your position is. This is not a borderline or methodology-dependent call. Both Zoya and Musaffa, the two most widely used halal screening platforms among North American Muslim investors, classify RBC as not Shariah-compliant, and Shariah-screened products available to Canadians, such as Wealthsimple's WSHR ETF and the S&P/TSX 60 Shariah index, exclude conventional banks by construction. There is no debt-ratio improvement or quarterly update that would change this verdict, because the problem is the business itself, not the balance sheet. For Canadian Muslim investors, the practical takeaway is that RBC's popularity, dividend history, and blue-chip status do not change the analysis. Investors seeking dividend income from TSX-listed companies generally look instead at screened names in permissible sectors such as railways, energy, and industrials, after verifying current compliance on a screening app, or use a purpose-built Shariah-screened fund. ## Business activity screen Result: Fail Royal Bank of Canada is Canada's largest bank by market capitalization, operating through five business segments: Personal Banking, Commercial Banking, Wealth Management, Insurance, and Capital Markets. In fiscal 2025 (year ended October 31, 2025) it reported total revenue of $66,605 million, of which net interest income was $33,000 million and non-interest income was $33,605 million. RBC's core business is conventional interest-based banking. Per its Q4 2025 earnings release and supplementary financial information, net interest income of $33,000 million represented roughly half (approximately 49.5%) of total fiscal 2025 revenue of $66,605 million, and much of the remaining non-interest income derives from conventional financial services including insurance and capital markets. This is a categorical business-screen failure under AAOIFI-style screening, which excludes companies whose primary business is conventional lending, far above the ~5% impermissible-revenue tolerance. ## Financial ratio screen (AAOIFI) Data as of: 2026-04-30 | Screen | Value | Limit | Result | |---|---|---|---| | Interest-bearing debt / market cap | 100.7% | < 30% | Fail | | Cash + interest-bearing securities / market cap | 15.3% | < 30% | Pass | | Impermissible income / total revenue | 75.6% | < 5% | Fail | Screening basis: AAOIFI Shariah Standard No. 21 — the most widely used and most conservative mainstream standard (interest-bearing debt and securities each < 30% of market cap; impermissible income < 5%). Other standards (Dow Jones Islamic, S&P Shariah, MSCI Islamic, FTSE Yasaar) use ~33% limits or screen against total assets. Full methodology: https://www.halalwallet.ca/halal-stock-screening-methodology ## Scholars' and screeners' positions - **Wealthsimple Shariah World Equity Index ETF (WSHR)**: Not held in WSHR as of 2026-06-11. Absence can reflect screen failure or index scope — verify before citing as a screen outcome. ([source](https://help.wealthsimple.com/hc/en-ca/articles/1500011334461-Stocks-held-in-the-Wealthsimple-Shariah-World-Equity-Index-ETF-WSHR)) - **undefined**: undefined - **undefined**: undefined - **SP Funds S&P 500 Sharia ETF (SPUS)**: Verify current SPUS schedule before citing as held (reference SOI 2026-02-28). ([source](https://www.sec.gov/Archives/edgar/data/1742912/000200032426001717/spus-soi_022826.htm)) - **Wahed FTSE USA Shariah ETF (HLAL)**: Verify current HLAL holdings before citing as held (reference 2026-06-05). ([source](https://stockanalysis.com/etf/hlal/holdings/)) ## Sources - RY.TO latest filings on SEDAR+ (balance sheet 2026-04-30) (https://www.sedarplus.ca/csa-party/records/document.html) - AAOIFI Shariah Standards (https://aaoifi.com) - RBC Q4 2025 Earnings Release (fiscal 2025 results) (https://www.rbc.com/investor-relations/_assets-custom/pdf/2025q4release.pdf) - RBC Q4 2025 Supplementary Financial Information (net interest income detail) (https://www.rbc.com/investor-relations/_assets-custom/pdf/25q4supp.pdf) - RBC 2025 Annual Report (https://www.rbc.com/investor-relations/_assets-custom/pdf/ar_2025_e.pdf) - Zoya screener page for RY (https://zoya.finance/stocks/ry) - Musaffa screener page for RY.TO (https://musaffa.com/stock/RY.TO) - WSHR holdings list (Wealthsimple) (https://help.wealthsimple.com/hc/en-ca/articles/1500011334461-Stocks-held-in-the-Wealthsimple-Shariah-World-Equity-Index-ETF-WSHR) - S&P Shariah Indices Methodology (spglobal.com) (https://www.spglobal.com/spdji/pt/documents/methodologies/methodology-sp-shariah-indices.pdf) ## Frequently asked questions ### Is Royal Bank of Canada (RY.TO) stock halal? No. Royal Bank of Canada fails Shariah screening — see the screen table and analysis on this page for the specific business-activity or ratio reasons. ### Does Royal Bank of Canada pass the AAOIFI financial ratio screen? As of 2026-04-30: interest-bearing debt is 100.7% of market cap (limit < 30%); cash plus interest-bearing securities is 15.3% (limit < 30%). The impermissible-income line is verified against the annual filing where noted on this page. ### Is Royal Bank of Canada held in halal ETFs like SPUS or HLAL? No — as of our last check, Royal Bank of Canada is not held by WSHR. 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