Royal Bank of Canada reported a rise in fourth-quarter profit on Thursday, as a strong performance in its corporate and investment banking unit offset a hit from bigger loan-default provisions.

A rebound in dealmaking helped the biggest Canadian bank’s capital markets unit. Net income from the business jumped 36% to C$987 million, helped by strength in corporate and investment banking, the bank said.

It, however, built up its provisions for credit losses (PCLs) as a darkening economic outlook prompted further caution. PCLs at the bank surged to C$720 million from C$381 million a year earlier.

RBC plans thousands of job cuts after profit beat

The Canadian economy has been teetering on the brink of a recession, underscoring the impact of the central bank’s aggressive rate hikes.

RBC has also been shoring up liquidity at its U.S. unit, City National Bank. In a report filed with regulators last month, City National said RBC had injected about $2.95 billion into the bank this year.

The bank reported a net income of C$4.13 billion ($3.04 billion), or C$2.90 per share, for the three months ended Oct. 31, compared with C$3.88 billion, or C$2.74 per share, a year earlier.