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UPDATE 1-Royal Bank of Canada raises dividend as profit edges higher

* Profit of C$1.47/share excluding items vs. C$1.43 estimate

* Capital markets income drives results

* Hikes dividend by 6 percent to C$0.71 a share

TORONTO, Feb 26 (Reuters) - Royal Bank of Canada's quarterly profit topped analysts' estimates, rising 2 percent on the back of higher capital markets income, and the bank raised its dividend by 6 percent.

Canada's largest bank said on Wednesday it had earned C$2.09 billion ($1.89 billion), or C$1.38 a share, in the first quarter ended Jan. 31, compared with C$2.05 billion, or C$1.34 a share, a year earlier.

Excluding C$92 million in charges from the sale of Jamaican operations announced last month as well as restructuring charges in the Caribbean, earnings were C$1.47 a share. Analysts on average had expected C$1.43, according to Thomson Reuters I/B/E/S.

Capital markets income rose 9 percent to C$505 million, and investor and treasury services income climbed 34 percent to C$106 million.

The bank said in January that it would sell its Jamaican banking operations to Sagicore Group Jamaica Ltd, but it did not have any plans to divest other assets in the Caribbean.

Personal and commercial banking income slipped 3 percent to C$1.07 billion, but would have risen 5 percent without the items from the Jamaican operations sale and Caribbean restructuring.

Loan-loss provisions decreased by 16 percent to C$292 million from a year earlier.

The bank said it was raising its quarterly dividend by 4 Canadian cents to 71 Canadian cents per share.

RBC is the second of Canada's five biggest banks to report results. On Tuesday, Bank of Montreal reported a 2 percent rise in quarterly profit on strong wealth management and domestic banking profits.

Toronto-Dominion Bank and Canadian Imperial Bank of Commerce will release results on Thursday.