Annual Financial Statements

MANAGEMENT’S RESPONSIBILITY FOR FINANCIAL REPORTING

The accompanying financial statements have been prepared by RBC Global Asset Management Inc. (“RBC GAM”) as manager of the RBC GAM Investment Funds (the “Funds”) and approved by the Board of Directors of RBC GAM. We are responsible for the information contained within the financial statements.

We have maintained appropriate procedures and controls to ensure that timely and reliable financial information is produced. The financial statements have been prepared in compliance with International Financial Reporting Standards (“IFRS”) (and they include certain amounts that are based on estimates and judgments). The significant accounting policies, which we believe are appropriate for the Funds, are described in Note 3 to the financial statements.

PricewaterhouseCoopers LLP, Chartered Professional Accountants, Licensed Public Accountants, have performed an independent audit of the financial statements in accordance with IFRS. Their report is set out on the next page.

Damon G. Williams, FSA, FCIA, CFA Heidi Johnston, CPA, CA Chief Executive Officer Chief Financial Officer RBC Global Asset Management Inc. RBC GAM Funds March 11, 2021 INDEPENDENT AUDITOR’S REPORT

To the Unitholders and Trustee of RBC Retirement 2040 Portfolio RBC QUBE All Country World Equity Fund RBC Retirement 2045 Portfolio RBC QUBE Low Volatility All Country World Equity Fund RBC FUNDS RBC Retirement 2050 Portfolio RBC Global Energy Fund RBC Canadian T-Bill Fund RBC Retirement 2055 Portfolio RBC Global Precious Metals Fund RBC Canadian Money Market Fund RBC Retirement 2060 Portfolio RBC Global Resources Fund RBC Premium Money Market Fund RBC Target 2025 Education Fund RBC Global Technology Fund RBC $U.S. Money Market Fund RBC Target 2030 Education Fund RBC Premium $U.S. Money Market Fund RBC Target 2035 Education Fund RBC PRIVATE POOLS RBC Canadian Short-Term Income Fund RBC Canadian Dividend Fund RBC Private Short-Term Income Pool RBC $U.S. Short-Term Corporate Bond Fund RBC Canadian Equity Fund RBC Private Canadian Corporate Bond Pool RBC Monthly Income Bond Fund RBC QUBE Canadian Equity Fund RBC Private Income Pool RBC Canadian Bond Index Fund RBC QUBE Low Volatility Canadian Equity Fund RBC Private Canadian Dividend Pool RBC Canadian Government Bond Index Fund RBC Trend Canadian Equity Fund RBC Private Fundamental Canadian Equity Pool RBC Bond Fund RBC Vision Canadian Equity Fund RBC Private Canadian Equity Pool RBC Vision Bond Fund RBC Canadian Index Fund RBC Private Canadian Mid-Cap Equity Pool RBC Global Bond Fund RBC O’Shaughnessy Canadian Equity Fund RBC Private U.S. Large-Cap Value Equity Pool RBC Global Bond & Currency Fund RBC O’Shaughnessy All-Canadian Equity Fund RBC Private U.S. Large-Cap Value Equity Currency RBC $U.S. Investment Grade Corporate Bond Fund RBC Canadian Equity Income Fund Neutral Pool RBC Global Corporate Bond Fund RBC Canadian Small & Mid-Cap Resources Fund RBC Private U.S. Growth Equity Pool RBC High Yield Bond Fund RBC North American Value Fund RBC Private U.S. Large-Cap Core Equity Pool RBC $U.S. High Yield Bond Fund RBC North American Growth Fund RBC Private U.S. Large-Cap Core Equity Currency RBC Global High Yield Bond Fund RBC U.S. Dividend Fund Neutral Pool RBC Strategic Income Bond Fund RBC U.S. Dividend Currency Neutral Fund RBC Private U.S. Small-Cap Equity Pool RBC $U.S. Strategic Income Bond Fund RBC U.S. Equity Fund RBC Private EAFE Equity Pool RBC Emerging Markets Foreign Exchange Fund RBC U.S. Equity Currency Neutral Fund RBC Private Overseas Equity Pool RBC Emerging Markets Bond Fund RBC QUBE U.S. Equity Fund RBC Private World Equity Pool RBC Emerging Markets Bond Fund (CAD Hedged) RBC QUBE Low Volatility U.S. Equity Fund RBC ALTERNATIVE FUNDS BlueBay Global Monthly Income Bond Fund RBC QUBE Low Volatility U.S. Equity BlueBay Global Alternative Bond Fund (Canada) BlueBay Global Sovereign Bond Fund (Canada) Currency Neutral Fund BlueBay Global Investment Grade Corporate RBC U.S. Equity Value Fund PH&N FUNDS Bond Fund (Canada) RBC U.S. Index Fund Phillips, Hager & North Canadian Money Market Fund BlueBay European High Yield Bond Fund (Canada) RBC U.S. Index Currency Neutral Fund Phillips, Hager & North $U.S. Money Market Fund BlueBay Emerging Markets Bond Fund (Canada) RBC O’Shaughnessy U.S. Value Fund (Unhedged) Phillips, Hager & North Short Term Bond & Mortgage Fund BlueBay Emerging Markets Local Currency RBC O’Shaughnessy U.S. Value Fund Phillips, Hager & North Bond Fund Bond Fund (Canada) RBC U.S. Mid-Cap Growth Equity Fund Phillips, Hager & North Total Return Bond Fund BlueBay Emerging Markets Corporate Bond Fund RBC U.S. Mid-Cap Growth Equity Currency Neutral Fund Phillips, Hager & North Inflation-Linked Bond Fund BlueBay Global Convertible Bond Fund (Canada) RBC U.S. Mid-Cap Value Equity Fund Phillips, Hager & North High Yield Bond Fund BlueBay $U.S. Global Convertible Bond Fund (Canada) RBC U.S. Small-Cap Core Equity Fund Phillips, Hager & North Long Inflation-linked Bond Fund RBC Conservative Bond Pool RBC U.S. Small-Cap Value Equity Fund Phillips, Hager & North Monthly Income Fund RBC Core Bond Pool RBC O’Shaughnessy U.S. Growth Fund Phillips, Hager & North Balanced Fund RBC Core Plus Bond Pool RBC O’Shaughnessy U.S. Growth Fund II Phillips, Hager & North Dividend Income Fund RBC Managed Payout Solution RBC Life Science and Technology Fund Phillips, Hager & North Canadian Equity Fund RBC Managed Payout Solution – Enhanced RBC International Dividend Growth Fund Phillips, Hager & North Canadian Equity Value Fund RBC Managed Payout Solution – Enhanced Plus RBC International Equity Fund Phillips, Hager & North Canadian Equity Underlying Fund RBC Monthly Income Fund RBC International Equity Currency Neutral Fund Phillips, Hager & North Canadian Equity RBC U.S. Monthly Income Fund RBC International Index Currency Neutral Fund Underlying Fund II RBC Balanced Fund RBC O’Shaughnessy International Equity Fund Phillips, Hager & North Canadian Growth Fund RBC Global Balanced Fund RBC European Dividend Fund Phillips, Hager & North Canadian Income Fund RBC Vision Balanced Fund RBC European Equity Fund Phillips, Hager & North Vintage Fund RBC Emerging Markets Balanced Fund RBC European Mid-Cap Equity Fund Phillips, Hager & North U.S. Dividend Income Fund RBC Conservative Growth & Income Fund RBC Asian Equity Fund Phillips, Hager & North U.S. Multi-Style RBC Balanced Growth & Income Fund RBC Asia Pacific ex-Japan Equity Fund All-Cap Equity Fund RBC Global Growth & Income Fund RBC China Equity Fund Phillips, Hager & North U.S. Equity Fund RBC Select Very Conservative Portfolio RBC Japanese Equity Fund Phillips, Hager & North Currency-Hedged RBC Select Conservative Portfolio RBC Emerging Markets Multi-Strategy Equity Fund U.S. Equity Fund RBC Select Balanced Portfolio RBC Emerging Markets Dividend Fund Phillips, Hager & North U.S. Growth Fund RBC Select Growth Portfolio RBC Emerging Markets Equity Fund Phillips, Hager & North Overseas Equity Fund RBC Select Aggressive Growth Portfolio RBC Emerging Markets Equity Focus Fund Phillips, Hager & North Currency-Hedged RBC Select Choices Conservative Portfolio RBC QUBE Low Volatility Emerging Markets Equity Fund Overseas Equity Fund RBC Select Choices Balanced Portfolio RBC Emerging Markets Small-Cap Equity Fund Phillips, Hager & North Global Equity Fund RBC Select Choices Growth Portfolio RBC Global Dividend Growth Fund Phillips, Hager & North LifeTime 2015 Fund RBC Select Choices Aggressive Growth Portfolio RBC Global Dividend Growth Currency Neutral Fund Phillips, Hager & North LifeTime 2020 Fund RBC Global Very Conservative Portfolio RBC Global Equity Fund Phillips, Hager & North LifeTime 2025 Fund RBC Global Conservative Portfolio RBC Global Equity Focus Fund Phillips, Hager & North LifeTime 2030 Fund RBC Global Balanced Portfolio RBC Global Equity Focus Currency Neutral Fund Phillips, Hager & North LifeTime 2035 Fund RBC Global Growth Portfolio RBC QUBE Global Equity Fund Phillips, Hager & North LifeTime 2040 Fund RBC Global All-Equity Portfolio RBC QUBE Low Volatility Global Equity Fund Phillips, Hager & North LifeTime 2045 Fund RBC Retirement Income Solution RBC QUBE Low Volatility Global Equity Phillips, Hager & North LifeTime 2050 Fund RBC Retirement 2020 Portfolio Currency Neutral Fund Phillips, Hager & North LifeTime 2055 Fund RBC Retirement 2025 Portfolio RBC Vision Global Equity Fund Phillips, Hager & North LifeTime 2060 Fund RBC Retirement 2030 Portfolio RBC Vision Fossil Fuel Free Global Equity Fund Phillips, Hager & North Conservative Pension Trust RBC Retirement 2035 Portfolio RBC O’Shaughnessy Global Equity Fund Phillips, Hager & North Balanced Pension Trust INDEPENDENT AUDITOR’S REPORT

PH&N FUNDS (cont.) Phillips, Hager & North Growth Pension Trust Phillips, Hager & North Conservative Equity Income Fund Phillips, Hager & North Canadian Equity Pension Trust Phillips, Hager & North Small Float Fund Phillips, Hager & North Canadian Equity Plus Pension Trust

(individually, a Fund)

Our opinion In our opinion, the accompanying December 31, 2020 financial statements of each Fund present fairly, in all material respects, the financial position of each Fund, its financial performance and its cash flows as at and for the periods indicated in note 2 in accordance with International Financial Reporting Standards (IFRS).

What we have audited The financial statements of each Fund comprise:

• the statements of financial position as at the period-end dates indicated in note 2;

• the statements of comprehensive income for the periods indicated in note 2;

• the statements of cash flow for the periods indicated in note 2;

• the statements of changes in net assets attributable to holders of redeemable units (NAV) for the periods indicated in note 2; and

• the notes to the financial statements, which include significant accounting policies and other explanatory information.

Basis for opinion We conducted our audit in accordance with Canadian generally accepted auditing standards. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of our report.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Independence We are independent of each Fund in accordance with the ethical requirements that are relevant to our audit of the financial statements in Canada. We have fulfilled our other ethical responsibilities in accordance with these requirements.

Other information Management is responsible for the other information of each Fund. The other information comprises the 2020 Annual Management Report of Fund Performance of each Fund.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements of each Fund, our responsibility is to read the other information identified above and, in doing so, consider whether the other information is materially inconsistent with the financial statements of each Fund or our knowledge obtained in the audit, or otherwise appears to be materially misstated.

If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard. INDEPENDENT AUDITOR’S REPORT

Responsibilities of management and those charged with governance for the financial statements Management is responsible for the preparation and fair presentation of the financial statements of each Fund in accordance with IFRS, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, management is responsible for assessing the ability of each Fund to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless management either intends to liquidate any Fund or to cease operations, or has no realistic alternative but to do so.

Those charged with governance are responsible for overseeing the financial reporting process of each Fund.

Auditor’s responsibilities for the audit of the financial statements Our objectives are to obtain reasonable assurance about whether the financial statements as a whole for each Fund are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Canadian generally accepted auditing standards will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of the financial statements of each Fund.

As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise professional judgment and maintain professional skepticism throughout the audit. We also:

• Identify and assess the risks of material misstatement of the financial statements of each Fund, whether due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

• Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the internal control of each Fund.

• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by management.

• Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the ability of each Fund to continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our auditor’s report to the related disclosures in the financial statements of each Fund or, if such disclosures are inadequate, to modify our opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report. However, future events or conditions may cause any Fund to cease to continue as a going concern.

• Evaluate the overall presentation, structure and content of the financial statements of each Fund, including the disclosures, and whether the financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit.

Chartered Professional Accountants, Licensed Public Accountants

Toronto, Ontario March 11, 2021 2020 ANNUAL FINANCIAL STATEMENTS

SCHEDULE OF INVESTMENT PORTFOLIO (in USD000s) RBC $U.S. INVESTMENT GRADE CORPORATE BOND FUND

December 31, 2020

Par Value Coupon Fair % of Net (000s) Security Rate % Maturity Cost Value Assets BONDS Australia 1 500 Australia & New Zealand Banking Group Ltd. USD 4.400 19-May-2026 $ 1 596 $ 1 726 1 250 Australia & New Zealand Banking Group Ltd. USD 2.950 22-Jul-2030 1 303 1 319 975 Westpac Banking Corp. USD 2.894 04-Feb-2030 975 1 023 1 150 Westpac Banking Corp. USD 4.322 23-Nov-2031 1 176 1 312 1 000 Westpac Banking Corp. USD 4.110 24-Jul-2034 1 132 1 146 6 182 6 526 2.3 Canada 500 Alimentation Couche-Tard Inc. USD 2.950 25-Jan-2030 498 547 500 Bank of Nova Scotia USD 1.300 11-Jun-2025 498 513 500 Enbridge Inc. USD 4.250 01-Dec-2026 573 586 1 300 Enbridge Inc. USD 3.125 15-Nov-2029 1 341 1 430 300 Nutrien Ltd. USD 3.150 01-Oct-2022 299 312 900 Nutrien Ltd. USD 3.625 15-Mar-2024 875 977 400 Nutrien Ltd. USD 4.000 15-Dec-2026 438 465 750 Nutrien Ltd. USD 4.200 01-Apr-2029 748 897 975 Rogers Communications Inc. USD 4.350 01-May-2049 1 036 1 262 1 985 TransCanada PipeLines Ltd. USD 4.625 01-Mar-2034 2 202 2 428 350 Waste Connections Inc. USD 3.050 01-Apr-2050 345 381 8 853 9 798 3.5 Finland 1 500 Nordea Bank ABP USD 0.750 28-Aug-2025 1 492 1 500 1 492 1 500 0.5 France 1 100 AXA S.A. USD 8.600 15-Dec-2030 1 419 1 714 800 BNP Paribas S.A. USD 2.950 23-May-2022 799 829 625 BNP Paribas S.A. USD 3.375 09-Jan-2025 647 686 1 000 Credit Agricole S.A. USD 3.250 04-Oct-2024 996 1 086 3 861 4 315 1.6 Ireland 177 Shire Acquisitions Investments Ireland DAC USD 2.400 23-Sep-2021 177 179 345 Shire Acquisitions Investments Ireland DAC USD 2.875 23-Sep-2023 342 366 519 545 0.2 Japan 600 Takeda Pharmaceutical Co. Ltd. USD 4.000 26-Nov-2021 600 617 500 Takeda Pharmaceutical Co. Ltd. USD 2.050 31-Mar-2030 499 512 600 Takeda Pharmaceutical Co. Ltd. USD 3.025 09-Jul-2040 619 633 500 Takeda Pharmaceutical Co. Ltd. USD 3.175 09-Jul-2050 500 533 2 218 2 295 0.8 Netherlands 1 750 Cooperatieve Rabobank U.A. USD 4.375 04-Aug-2025 1 792 1 998 1 250 ING Groep N.V. USD 3.150 29-Mar-2022 1 248 1 293 750 ING Groep N.V. USD 3.550 09-Apr-2024 749 820 300 NXP BV USD 4.875 01-Mar-2024 300 338 400 NXP BV USD 2.700 01-May-2025 400 431 4 489 4 880 1.8

The accompanying notes are an integral part of the financial statements. S C H E D U L O F I N V T M P R ( i n $ 0 s ) SCHEDULE OF INVESTMENT PORTFOLIO (in USD000s) RBC $U.S. INVESTMENT GRADE CORPORATE BOND FUND

December 31, 2020

Par Value Coupon Fair % of Net (000s) Security Rate % Maturity Cost Value Assets Switzerland 1 000 Credit Suisse Group AG USD 2.593 11-Sep-2025 $ 1 000 $ 1 053 500 Credit Suisse Group AG USD 3.869 12-Jan-2029 500 567 250 Credit Suisse Group Funding Guernsey Ltd. USD 3.800 15-Sep-2022 256 264 1 756 1 884 0.7 United Kingdom 500 BAE Systems Plc. USD 3.400 15-Apr-2030 496 567 300 BAE Systems Plc. USD 1.900 15-Feb-2031 298 304 350 BAE Systems Plc. USD 3.000 15-Sep-2050 345 366 1 000 Barclays Plc. USD 3.200 10-Aug-2021 996 1 017 500 Barclays Plc. USD 4.375 12-Jan-2026 498 577 225 HSBC Holdings Plc. USD 3.600 25-May-2023 225 242 1 300 HSBC Holdings Plc. USD 2.099 04-Jun-2026 1 322 1 352 1 000 Lloyds Banking Group Plc. USD 2.907 07-Nov-2023 1 000 1 045 675 Lloyds Banking Group Plc. USD 4.450 08-May-2025 675 774 725 Vodafone Group Plc. USD 4.125 30-May-2025 729 829 1 000 Vodafone Group Plc. USD 6.150 27-Feb-2037 1 239 1 443 675 Vodafone Group Plc. USD 5.250 30-May-2048 787 939 350 Vodafone Group Plc. USD 4.875 19-Jun-2049 365 468 8 975 9 923 3.6 United States 350 AbbVie Inc. 3.250 01-Oct-2022 350 365 500 AbbVie Inc. 2.600 21-Nov-2024 500 536 1 250 AbbVie Inc. 3.200 14-May-2026 1 377 1 386 2 000 AbbVie Inc. 2.950 21-Nov-2026 2 036 2 214 250 AEP Transmission Co. LLC 3.150 15-Sep-2049 248 279 425 Agilent Technologies Inc. 2.750 15-Sep-2029 422 464 200 Alcon Finance Corp. 2.750 23-Sep-2026 199 219 500 Alcon Finance Corp. 3.000 23-Sep-2029 524 546 600 Alcon Finance Corp. 3.800 23-Sep-2049 599 709 1 300 Alexandria Real Estate Equities Inc. 1.875 01-Feb-2033 1 299 1 300 600 American Tower Corp. 4.700 15-Mar-2022 626 630 525 American Tower Corp. 3.000 15-Jun-2023 524 556 250 American Tower Corp. 4.000 01-Jun-2025 267 283 727 American Tower Corp. 3.375 15-Oct-2026 765 817 700 American Tower Corp. 2.750 15-Jan-2027 699 760 500 American Tower Corp. 3.600 15-Jan-2028 549 569 1 000 Amgen Inc. 2.300 25-Feb-2031 996 1 068 250 Amgen Inc. 3.150 21-Feb-2040 272 276 1 050 Amgen Inc. 4.400 01-May-2045 1 256 1 334 1 450 Anheuser-Busch InBev Worldwide Inc. 4.700 01-Feb-2036 1 545 1 841 310 Anheuser-Busch InBev Worldwide Inc. 5.450 23-Jan-2039 388 419 1 400 Anheuser-Busch InBev Worldwide Inc. 4.900 01-Feb-2046 1 804 1 828 330 Anheuser-Busch InBev Worldwide Inc. 4.600 15-Apr-2048 395 418 312 Anheuser-Busch InBev Worldwide Inc. 4.439 06-Oct-2048 276 388 100 Anthem Inc. 3.650 01-Dec-2027 100 115 1 250 Aon Corp. 4.500 15-Dec-2028 1 467 1 510 450 Aon Corp. 2.800 15-May-2030 450 491 1 600 Appalachian Power Co. 7.000 01-Apr-2038 2 225 2 466 1 100 Apple Inc. 4.375 13-May-2045 1 288 1 508 1 400 Apple Inc. 4.650 23-Feb-2046 1 564 1 990 500 Apple Inc. 4.250 09-Feb-2047 505 682 300 AT&T Inc. 3.000 30-Jun-2022 307 311 230 AT&T Inc. 1.650 01-Feb-2028 230 235 1 800 AT&T Inc. 4.500 15-May-2035 1 944 2 185

December 31, 2020

Par Value Coupon Fair % of Net (000s) Security Rate % Maturity Cost Value Assets United States (cont.) 1 750 AT&T Inc. 5.250 01-Mar-2037 $ 1 844 $ 2 278 1 350 AT&T Inc. 5.650 15-Feb-2047 1 738 1 838 1 200 Avangrid Inc. 3.150 01-Dec-2024 1 195 1 309 700 Avangrid Inc. 3.800 01-Jun-2029 699 804 425 Baltimore Gas & Electric Co. 3.200 15-Sep-2049 421 476 1 500 Bank of America Corp. 2.503 21-Oct-2022 1 500 1 527 300 Bank of America Corp. 4.000 01-Apr-2024 324 333 250 Bank of America Corp. 3.307 23-Jul-2024 250 253 1 800 Bank of America Corp. 3.875 01-Aug-2025 1 814 2 055 1 000 Bank of America Corp. 1.197 24-Oct-2026 1 000 1 014 1 700 Bank of America Corp. 3.824 20-Jan-2028 1 820 1 953 300 Bank of America Corp. 3.194 23-Jul-2030 300 336 800 Bank of America Corp. 2.884 22-Oct-2030 810 879 750 Bank of America Corp. 2.592 29-Apr-2031 750 804 1 100 Bank of America Corp. 1.898 23-Jul-2031 1 100 1 112 350 Bank of America Corp. 2.676 19-Jun-2041 350 365 500 Bayer US Finance II LLC 4.250 15-Dec-2025 499 572 426 Becton Dickinson and Co. 2.894 06-Jun-2022 427 440 750 Becton Dickinson and Co. 3.363 06-Jun-2024 765 816 150 Becton Dickinson and Co. 3.734 15-Dec-2024 154 166 1 248 Becton Dickinson and Co. 4.685 15-Dec-2044 1 417 1 612 200 Bemis Co. Inc. 2.630 20-Jun-2030 200 217 200 Berkshire Hathaway Energy Co. 1.650 15-May-2031 199 200 950 Berkshire Hathaway Energy Co. 3.800 15-Jul-2048 1 041 1 138 350 Berkshire Hathaway Energy Co. 2.850 15-May-2051 350 360 750 Berkshire Hathaway Finance Corp. 4.200 15-Aug-2048 746 991 475 Berkshire Hathaway Finance Corp. 4.250 15-Jan-2049 470 631 175 Biogen Inc. 2.250 01-May-2030 175 183 425 BP Capital Markets America Inc. 3.224 14-Apr-2024 426 460 500 BP Capital Markets America Inc. 3.119 04-May-2026 497 554 350 Bristol-Myers Squibb Co. 3.200 15-Jun-2026 349 394 200 Bristol-Myers Squibb Co. 4.250 26-Oct-2049 198 271 500 Broadcom Corp. 3.125 15-Jan-2025 535 540 300 Broadcom Corp. 3.875 15-Jan-2027 311 337 975 Broadcom Corp. 3.500 15-Jan-2028 996 1 075 300 Broadcom Inc. 4.250 15-Apr-2026 312 344 1 954 Broadcom Inc. 4.110 15-Sep-2028 1 815 2 239 500 Burlington Northern Santa Fe LLC 5.750 01-May-2040 612 742 125 Carrier Global Corp. 3.377 05-Apr-2040 125 137 700 CenterPoint Energy Inc. 2.500 01-Sep-2022 700 724 700 CenterPoint Energy Inc. 3.850 01-Feb-2024 735 766 1 000 CenterPoint Energy Resources Corp. 4.100 01-Sep-2047 1 025 1 230 875 Charter Communications Operating LLC 4.464 23-Jul-2022 913 923 1 900 Charter Communications Operating LLC 4.908 23-Jul-2025 2 184 2 209 2 075 Charter Communications Operating LLC 5.050 30-Mar-2029 2 447 2 523 250 Charter Communications Operating LLC 2.800 01-Apr-2031 249 264 625 Church & Dwight Co. Inc. 2.450 01-Aug-2022 624 645 450 Cigna Corp. 3.193 15-Jul-2023 450 455 900 Citigroup Inc. 3.352 24-Apr-2025 900 979 800 Citigroup Inc. 3.300 27-Apr-2025 799 888 750 Citigroup Inc. 3.200 21-Oct-2026 741 839 2 450 Citigroup Inc. 3.668 24-Jul-2028 2 594 2 778 900 Citigroup Inc. 3.520 27-Oct-2028 900 1 018 500 Citigroup Inc. 3.980 20-Mar-2030 533 588 600 CMS Energy Corp. 4.875 01-Mar-2044 779 791 875 Comcast Corp. 4.250 15-Jan-2033 851 1 099

December 31, 2020

Par Value Coupon Fair % of Net (000s) Security Rate % Maturity Cost Value Assets United States (cont.) 150 Comcast Corp. 6.500 15-Nov-2035 $ 198 $ 232 350 Comcast Corp. 6.950 15-Aug-2037 517 564 200 Comcast Corp. 6.400 15-May-2038 249 312 475 Comcast Corp. 4.600 15-Oct-2038 475 626 350 Comcast Corp. 3.250 01-Nov-2039 349 397 450 Comcast Corp. 4.650 15-Jul-2042 618 610 575 Comcast Corp. 4.700 15-Oct-2048 575 801 500 Comcast Corp. 2.450 15-Aug-2052 496 487 1 100 ConocoPhillips 5.900 15-Oct-2032 1 308 1 503 1 300 ConocoPhillips Holding Co. 6.950 15-Apr-2029 1 691 1 824 500 Consolidated Edison Company of New York Inc. 5.500 01-Dec-2039 600 687 750 Consolidated Edison Company of New York Inc. 4.125 15-May-2049 750 928 675 CoStar Group Inc. 2.800 15-Jul-2030 674 702 525 Crown Castle International Corp. 5.250 15-Jan-2023 565 575 675 Crown Castle International Corp. 1.350 15-Jul-2025 673 690 69 CVS Health Corp. 3.700 09-Mar-2023 74 74 700 CVS Health Corp. 1.300 21-Aug-2027 698 703 475 CVS Health Corp. 3.250 15-Aug-2029 528 536 750 CVS Health Corp. 4.875 20-Jul-2035 820 973 1 145 CVS Health Corp. 4.780 25-Mar-2038 1 158 1 447 550 CVS Health Corp. 5.050 25-Mar-2048 547 745 425 Danaher Corp. 4.375 15-Sep-2045 574 563 550 Danaher Corp. 2.600 01-Oct-2050 544 571 297 Dell International LLC 5.450 15-Jun-2023 321 329 500 Dell International LLC 4.000 15-Jul-2024 522 552 200 DH Europe Finance II Sarl 3.250 15-Nov-2039 200 228 200 DH Europe Finance II Sarl 3.400 15-Nov-2049 200 237 500 Diamond 1 Finance Corp. 6.020 15-Jun-2026 566 611 650 Discovery Communications LLC 3.950 20-Mar-2028 666 746 850 Dominion Energy Inc. 3.900 01-Oct-2025 952 966 750 Dominion Energy Inc. 4.250 01-Jun-2028 884 900 350 Dominion Energy Inc. 4.050 15-Sep-2042 372 422 1 100 Dominion Energy Inc. 4.600 15-Mar-2049 1 477 1 477 500 DowDuPont Inc. 4.493 15-Nov-2025 500 584 1 000 DowDuPont Inc. 4.725 15-Nov-2028 1 000 1 232 375 DTE Energy Co. 2.600 15-Jun-2022 375 387 1 000 Duke Energy Corp. 2.450 01-Jun-2030 1 061 1 066 1 270 Duke Energy Corp. 3.750 01-Sep-2046 1 231 1 480 750 EMD Finance LLC 2.950 19-Mar-2022 749 770 850 Enbridge Energy Partners LP 5.875 15-Oct-2025 981 1 040 750 Energy Transfer Operating LP 3.600 01-Feb-2023 768 786 300 Energy Transfer Partners LP 5.200 01-Feb-2022 315 311 250 Enterprise Products Operating LLC 3.750 15-Feb-2025 277 280 500 Enterprise Products Operating LLC 2.800 31-Jan-2030 536 542 450 Enterprise Products Operating LLC 4.250 15-Feb-2048 447 529 780 Enterprise Products Operating LLC 3.700 31-Jan-2051 775 860 610 Equifax Inc. 2.600 01-Dec-2024 609 654 415 Evergy Inc. 2.450 15-Sep-2024 414 440 625 Evergy Inc. 2.900 15-Sep-2029 624 686 500 Eversource Energy 3.450 15-Jan-2050 588 574 850 Exelon Corp. 5.625 15-Jun-2035 987 1 150 1 300 Exelon Corp. 4.450 15-Apr-2046 1 339 1 658 500 FedEx Corp. 4.550 01-Apr-2046 616 643 425 FedEx Corp. 4.050 15-Feb-2048 423 514 800 FMC Corp. 3.200 01-Oct-2026 847 892 600 FMC Corp. 3.450 01-Oct-2029 600 685

December 31, 2020

Par Value Coupon Fair % of Net (000s) Security Rate % Maturity Cost Value Assets United States (cont.) 750 General Motors Financial Co. Inc. 4.375 25-Sep-2021 $ 782 $ 770 650 General Motors Financial Co. Inc. 3.450 14-Jan-2022 649 667 800 Georgia-Pacific LLC 8.000 15-Jan-2024 1 034 977 225 Gilead Sciences Inc. 2.600 01-Oct-2040 224 228 500 Gilead Sciences Inc. 2.800 01-Oct-2050 497 497 500 HCA Inc. 4.750 01-May-2023 535 545 250 Ingersoll-Rand Global Holding Co. Ltd. 4.250 15-Jun-2023 268 273 400 Ingersoll-Rand Luxembourg Finance S.A. 3.500 21-Mar-2026 414 452 125 Interstate Power and Light Co. 2.300 01-Jun-2030 124 132 850 JPMorgan Chase & Co. 1.514 01-Jun-2024 870 873 700 JPMorgan Chase & Co. 3.125 23-Jan-2025 698 767 510 JPMorgan Chase & Co. 3.220 01-Mar-2025 517 551 500 JPMorgan Chase & Co. 2.083 22-Apr-2026 500 528 750 JPMorgan Chase & Co. 2.950 01-Oct-2026 748 832 2 125 JPMorgan Chase & Co. 1.045 20-Nov-2026 2 125 2 150 2 450 JPMorgan Chase & Co. 3.540 01-May-2028 2 622 2 802 500 JPMorgan Chase & Co. 3.509 23-Jan-2029 560 571 1 350 JPMorgan Chase & Co. 2.739 15-Oct-2030 1 347 1 470 500 JPMorgan Chase & Co. 2.522 22-Apr-2031 500 538 1 350 Kinder Morgan Energy Partners LP 6.950 15-Jan-2038 1 609 1 849 1 000 Kinder Morgan Inc. 5.625 15-Nov-2023 1 133 1 126 500 Kinder Morgan Inc. 2.000 15-Feb-2031 492 506 625 KLA Corp. 5.000 15-Mar-2049 709 870 800 Kraft Heinz Foods Co. 3.950 15-Jul-2025 800 881 630 L3Harris Technologies Inc. 3.950 28-May-2024 694 695 250 L3Harris Technologies Inc. 2.900 15-Dec-2029 249 277 400 L3Harris Technologies Inc. 1.800 15-Jan-2031 400 408 500 Leidos Inc. 2.300 15-Feb-2031 498 510 350 Lowe's Cos Inc. 3.000 15-Oct-2050 350 375 400 Magellan Midstream Partners LP 5.150 15-Oct-2043 412 515 950 McCormick & Co. Inc. 3.400 15-Aug-2027 1 022 1 069 1 050 McDonald's Corp. 6.300 15-Oct-2037 1 442 1 582 400 McDonald's Corp. 4.875 09-Dec-2045 555 546 300 Mead Johnson Nutrition Co. 5.900 01-Nov-2039 410 446 107 Medtronic Inc. 4.625 15-Mar-2045 108 152 585 Mid-America Apartments LP 1.700 15-Feb-2031 582 584 864 MidAmerican Energy Holdings Co. 6.125 01-Apr-2036 1 065 1 279 750 Mondelez International Inc. 2.750 13-Apr-2030 743 824 1 550 Morgan Stanley 2.750 19-May-2022 1 556 1 601 1 600 Morgan Stanley 3.875 27-Jan-2026 1 629 1 836 1 000 Morgan Stanley 3.125 27-Jul-2026 1 003 1 121 1 000 Morgan Stanley 0.985 10-Dec-2026 1 000 1 008 500 Morgan Stanley 3.625 20-Jan-2027 564 574 1 750 Morgan Stanley 3.591 22-Jul-2028 1 806 1 999 450 NiSource Inc. 0.950 15-Aug-2025 449 453 500 NiSource Inc. 3.600 01-May-2030 498 579 250 Northrop Grumman Corp. 3.250 15-Jan-2028 250 283 600 Northrop Grumman Corp. 4.750 01-Jun-2043 838 801 800 Northrop Grumman Corp. 5.250 01-May-2050 1 213 1 189 300 Nutrition & Biosciences Inc. 1.832 15-Oct-2027 300 309 350 Nutrition & Biosciences Inc. 2.300 01-Nov-2030 350 361 500 Oncor Electric Delivery Co. LLC 7.250 15-Jan-2033 668 774 400 Oracle Corp. 2.800 01-Apr-2027 399 441 400 Oracle Corp. 2.950 01-Apr-2030 400 447 225 Oracle Corp. 3.600 01-Apr-2040 224 264 675 Oracle Corp. 4.500 08-Jul-2044 883 881

December 31, 2020

Par Value Coupon Fair % of Net (000s) Security Rate % Maturity Cost Value Assets United States (cont.) 400 Oracle Corp. 4.000 15-Jul-2046 $ 443 $ 491 1 000 Oracle Corp. 4.000 15-Nov-2047 1 003 1 235 600 PacifiCorp. 2.700 15-Sep-2030 599 661 345 Parker-Hannifin Corp. 2.700 14-Jun-2024 345 370 975 PepsiCo Inc. 4.450 14-Apr-2046 1 288 1 361 400 Phillips 66 Partners LP 3.550 01-Oct-2026 395 439 100 Phillips 66 Partners LP 3.750 01-Mar-2028 100 109 200 Piedmont Natural Gas Co. Inc. 3.350 01-Jun-2050 199 223 550 Progress Energy Inc. 6.000 01-Dec-2039 753 780 625 Prudential Financial Inc. 3.700 13-Mar-2051 621 758 625 PSEG Power LLC 3.850 01-Jun-2023 625 673 600 Public Service Enterprise Group Inc. 2.650 15-Nov-2022 599 626 500 Public Service Enterprise Group Inc. 2.875 15-Jun-2024 501 539 500 Public Service Enterprise Group Inc. 0.800 15-Aug-2025 499 501 800 Puget Energy Inc. 6.000 01-Sep-2021 925 828 1 550 Raytheon Technologies Corp. 3.200 15-Mar-2024 1 549 1 675 375 Raytheon Technologies Corp. 4.350 15-Apr-2047 353 494 325 Realty Income Corp. 0.750 15-Mar-2026 322 325 350 Republic Services Inc. 3.950 15-May-2028 345 411 500 Republic Services Inc. 1.450 15-Feb-2031 498 490 440 Republic Services Inc. 1.750 15-Feb-2032 440 441 825 Roper Technologies Inc. 2.800 15-Dec-2021 824 843 1 600 Sempra Energy 3.800 01-Feb-2038 1 645 1 856 1 650 Southern Co. Gas Capital Corp. 2.450 01-Oct-2023 1 701 1 735 515 Southern Co. Gas Capital Corp. 1.750 15-Jan-2031 513 519 750 Southwest Gas Holdings Inc. 3.800 29-Sep-2046 748 871 1 075 Southwestern Electric Power Co. 3.850 01-Feb-2048 1 090 1 269 750 Spectra Energy Partners LP 4.750 15-Mar-2024 782 838 900 Starbucks Corp. 4.500 15-Nov-2048 891 1 175 150 Steel Dynamics Inc. 1.650 15-Oct-2027 149 155 150 T-Mobile USA Inc. 2.050 15-Feb-2028 154 156 375 T-Mobile USA Inc. 2.250 15-Nov-2031 375 386 500 The Dow Chemical Co. 7.375 01-Nov-2029 672 713 325 The East Ohio Gas Co. 3.000 15-Jun-2050 320 354 1 550 The Goldman Sachs Group Inc. 5.750 24-Jan-2022 1 715 1 639 600 The Goldman Sachs Group Inc. 3.625 22-Jan-2023 612 640 300 The Goldman Sachs Group Inc. 2.905 24-Jul-2023 305 312 500 The Goldman Sachs Group Inc. 3.500 01-Apr-2025 546 556 900 The Goldman Sachs Group Inc. 3.750 22-May-2025 899 1 011 425 The Goldman Sachs Group Inc. 3.750 25-Feb-2026 424 483 540 The Goldman Sachs Group Inc. 1.093 09-Dec-2026 540 546 1 550 The Goldman Sachs Group Inc. 3.691 05-Jun-2028 1 662 1 788 459 The Hartford Financial Services Group Inc. 5.950 15-Oct-2036 612 644 400 The Hartford Financial Services Group Inc. 3.600 19-Aug-2049 400 470 275 The Kroger Co. 5.400 15-Jul-2040 330 374 1 025 The Kroger Co. 3.950 15-Jan-2050 1 051 1 246 250 The Sherwin-Williams Co. 3.125 01-Jun-2024 254 271 500 The Sherwin-Williams Co. 4.500 01-Jun-2047 607 669 1 100 The Southern Co. 4.250 01-Jul-2036 1 108 1 351 450 The Walt Disney Co. 7.300 30-Apr-2028 549 622 700 The Williams Companies Inc. 4.500 15-Nov-2023 746 772 500 The Williams Companies Inc. 4.300 04-Mar-2024 548 552 650 The Williams Companies Inc. 4.900 15-Jan-2045 686 769 650 Thermo Fisher Scientific Inc. 3.000 15-Apr-2023 646 686 100 Thermo Fisher Scientific Inc. 2.600 01-Oct-2029 100 110 500 Thermo Fisher Scientific Inc. 5.300 01-Feb-2044 717 727

December 31, 2020

Par Value Coupon Fair % of Net (000s) Security Rate % Maturity Cost Value Assets United States (cont.) 700 Truist Financial Corp. 1.125 03-Aug-2027 $ 699 $ 705 750 Tyson Foods Inc. 4.000 01-Mar-2026 747 863 725 Tyson Foods Inc. 5.100 28-Sep-2048 748 1 044 1 250 Union Pacific Corp. 3.550 15-Aug-2039 1 246 1 447 700 Union Pacific Corp. 4.300 01-Mar-2049 695 914 800 United States Treasury 1.125 15-May-2040 802 759 2 400 United States Treasury 1.250 15-May-2050 2 291 2 176 700 United Technologies Corp. 6.125 15-Jul-2038 985 1 038 300 United Technologies Corp. 5.700 15-Apr-2040 410 440 200 UnitedHealth Group Inc. 2.750 15-May-2040 194 217 920 Verizon Communications Inc. 4.125 16-Mar-2027 995 1 085 725 Verizon Communications Inc. 4.500 10-Aug-2033 745 914 1 800 Verizon Communications Inc. 5.250 16-Mar-2037 2 032 2 457 350 Verizon Communications Inc. 2.650 20-Nov-2040 356 354 500 Verizon Communications Inc. 5.012 15-Apr-2049 608 694 400 Verizon Communications Inc. 2.875 20-Nov-2050 399 403 600 Virginia Electric & Power Co. 3.300 01-Dec-2049 599 708 720 WEC Energy Group Inc. 1.800 15-Oct-2030 720 723 700 Wells Fargo & Co. 3.300 09-Sep-2024 714 767 1 650 Wells Fargo & Co. 3.000 23-Oct-2026 1 629 1 830 325 Wells Fargo & Co. 2.393 02-Jun-2028 325 346 800 Wells Fargo & Co. 4.150 24-Jan-2029 887 950 500 Williams Partners LP 3.750 15-Jun-2027 541 571 500 Williams Partners LP 4.850 01-Mar-2048 598 615 300 Willis North America Inc. 5.050 15-Sep-2048 424 423 210 886 229 972 82.9 TOTAL BONDS $ 249 231 271 638 97.9 OTHER NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS 5 751 2.1 NET ASSETS ATTRIBUTABLE TO HOLDERS OF REDEEMABLE UNITS $ 277 389 100.0

The accompanying notes are an integral part of the financial statements. S C H E D U L O F I N V T M P R ( i n $ 0 s ) FINANCIAL STATEMENTS RBC $U.S. INVESTMENT GRADE CORPORATE BOND FUND (in USD)

Statements of Financial Position Statements of Comprehensive Income (in $000s except per unit amounts) (in $000s except per unit amounts)

December 31 December 31 For the periods ended December 31 (see note 2 in the generic notes) 2020 2019 (see note 2 in the generic notes) 2020 2019 ASSETS INCOME (see note 3 in the generic notes) Investments at fair value $ 271 638 $ 221 711 Interest for distribution purposes $ 8 279 $ 6 866 Cash 4 252 2 397 Net realized gain (loss) on investments (6) 419 Subscriptions receivable 141 621 Change in unrealized gain (loss) on investments 12 395 16 297 Dividends receivable, interest accrued TOTAL NET GAIN (LOSS) ON and other assets 2 411 2 158 INVESTMENTS AND DERIVATIVES 20 668 23 582 TOTAL ASSETS 278 442 226 887 Securities lending revenue LIABILITIES (see note 7 in the generic notes) 4 2 Redemptions payable 954 207 TOTAL OTHER INCOME (LOSS) 4 2 Accounts payable and accrued expenses 99 77 TOTAL INCOME (LOSS) 20 672 23 584 TOTAL LIABILITIES EXCLUDING NET ASSETS EXPENSES (see notes – Fund Specific Information) ATTRIBUTABLE TO HOLDERS OF Management fees 825 471 REDEEMABLE UNITS 1 053 284 Administration fees 74 54 NET ASSETS ATTRIBUTABLE TO HOLDERS Independent Review Committee costs 2 1 OF REDEEMABLE UNITS (“NAV”) $ 277 389 $ 226 603 GST/HST 72 47 TOTAL EXPENSES 973 573 Investments at cost $ 249 231 $ 211 699 INCREASE (DECREASE) IN NAV $ 19 699 $ 23 011 INCREASE (DECREASE) IN NAV NAV SERIES A $ 3 705 $ 3 313 SERIES A $ 64 385 $ 56 109 ADVISOR SERIES $ 106 $ 61 ADVISOR SERIES $ 490 $ 972 SERIES D $ 180 $ 251 SERIES D $ 3 320 $ 2 979 SERIES F $ 2 262 $ 1 819 SERIES F $ 42 489 $ 17 451 SERIES O $ 13 446 $ 17 567 SERIES O $ 166 705 $ 149 092 INCREASE (DECREASE) IN NAV PER UNIT NAV PER UNIT SERIES A $ 0.69 $ 1.00 SERIES A $ 10.68 $ 10.05 ADVISOR SERIES $ 1.22 $ 0.93 ADVISOR SERIES $ 10.54 $ 9.93 SERIES D $ 0.61 $ 1.17 SERIES D $ 10.69 $ 10.07 SERIES F $ 0.78 $ 1.21 SERIES F $ 10.66 $ 10.04 SERIES O $ 0.91 $ 1.30 SERIES O $ 10.62 $ 10.00

The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENTS RBC $U.S. INVESTMENT GRADE CORPORATE BOND FUND (in USD)

Statements of Cash Flow (in $000s)

For the periods ended December 31 (see note 2 in the generic notes) 2020 2019 CASH FLOWS FROM OPERATING ACTIVITIES Increase (decrease) in NAV $ 19 699 $ 23 011 ADJUSTMENTS TO RECONCILE NET CASH PROVIDED BY (USED IN) OPERATIONS Interest for distribution purposes – – Non-cash dividends – – Non-cash distributions from underlying funds – – Net realized loss (gain) on investments 6 (419) Change in unrealized loss (gain) on investments (12 395) (16 297) (Increase) decrease in accrued receivables (253) (579) Increase (decrease) in accrued payables 22 46 (Increase) decrease in margin accounts – – Cost of investments purchased* (123 625) (100 187) Proceeds from sale and maturity of investments* 86 087 39 746 NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (30 459) (54 679) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from issue of redeemable units* 142 397 104 419 Cash paid on redemption of redeemable units* (106 684) (43 842) Distributions paid to holders of redeemable units (3 399) (3 669) NET CASH PROVIDED BY (USED IN) FINANCING ACTIVITIES $ 32 314 $ 56 908 Net increase (decrease) in cash for the period 1 855 2 229 Cash (bank overdraft), beginning of period 2 397 168 CASH (BANK OVERDRAFT), END OF PERIOD $ 4 252 $ 2 397

Interest received (paid)† $ 8 026 $ 6 287 Income from investment trusts received (paid)†‡ $ – $ – Dividends received (paid)†‡ $ – $ –

* Excludes in-kind transactions. † Classified as part of operating activities. ‡ Net of withholding taxes, if applicable.

The accompanying notes are an integral part of these financial statements. FINANCIAL STATEMENTS RBC $U.S. INVESTMENT GRADE CORPORATE BOND FUND (in USD)

Statements of Changes in NAV (in $000s)

For the periods ended December 31 Series A Advisor Series Series D Series F (see note 2 in the generic notes) 2020 2019 2020 2019 2020 2019 2020 2019 NAV AT BEGINNING OF PERIOD $ 56 109 $ 18 396 $ 972 $ 532 $ 2 979 $ 1 608 $ 17 451 $ 12 947 INCREASE (DECREASE) IN NAV 3 705 3 313 106 61 180 251 2 262 1 819 Early redemption fees 24 – – – – – – – Proceeds from redeemable units issued 40 269 47 665 694 673 2 951 2 069 41 728 12 823 Reinvestments of distributions to holders of redeemable units 1 093 772 19 13 76 58 552 235 Redemption of redeemable units (35 624) (13 230) (1 281) (291) (2 789) (947) (18 675) (9 932) NET INCREASE (DECREASE) FROM REDEEMABLE UNIT TRANSACTIONS 5 762 35 207 (568) 395 238 1 180 23 605 3 126 Distributions from net income (1 191) (807) (20) (16) (77) (60) (829) (441) Distributions from net gains – – – – – – – – Distributions from capital – – – – – – – – TOTAL DISTRIBUTIONS TO HOLDERS OF REDEEMABLE UNITS (1 191) (807) (20) (16) (77) (60) (829) (441) NET INCREASE (DECREASE) IN NAV 8 276 37 713 (482) 440 341 1 371 25 038 4 504 NAV AT END OF PERIOD $ 64 385 $ 56 109 $ 490 $ 972 $ 3 320 $ 2 979 $ 42 489 $ 17 451

For the periods ended December 31 Series O Total (see note 2 in the generic notes) 2020 2019 2020 2019 NAV AT BEGINNING OF PERIOD $ 149 092 $ 112 623 $ 226 603 $ 146 106 INCREASE (DECREASE) IN NAV 13 446 17 567 19 699 23 011 Early redemption fees – – 24 – Proceeds from redeemable units issued 60 383 41 706 146 025 104 936 Reinvestments of distributions to holders of redeemable units 2 149 1 494 3 889 2 572 Redemption of redeemable units (53 194) (19 381) (111 563) (43 781) NET INCREASE (DECREASE) FROM REDEEMABLE UNIT TRANSACTIONS 9 338 23 819 38 375 63 727 Distributions from net income (5 171) (4 917) (7 288) (6 241) Distributions from net gains – – – – Distributions from capital – – – – TOTAL DISTRIBUTIONS TO HOLDERS OF REDEEMABLE UNITS (5 171) (4 917) (7 288) (6 241) NET INCREASE (DECREASE) IN NAV 17 613 36 469 50 786 80 497 NAV AT END OF PERIOD $ 166 705 $ 149 092 $ 277 389 $ 226 603

The accompanying notes are an integral part of these financial statements. NOTES TO FINANCIAL STATEMENTS – FUND SPECIFIC INFORMATION RBC $U.S. INVESTMENT GRADE CORPORATE BOND FUND

December 31, 2020

Effective June 26, 2020, Advisor Series units have been Interest rate risk (%) capped. On August 4, 2020, Advisor Series units with initial The table below summarizes the Fund’s exposure to interest sales charge and/or low-load sales charge options were rate risk by remaining term to maturity as at: re-designated as Series A units, as applicable. Advisor Series December 31 December 31 units with a deferred sales charge option, as applicable, Term to maturity 2020 2019 remain capped and invested based on their existing Less than 1 year 1.7 3.5 redemption schedule. 1 – 5 years 25.6 28.6 5 – 10 years 31.0 30.7 General information (see note 1 in the generic notes) > 10 years 41.7 37.2 Total 100.0 100.0 The investment objective of the Fund is to provide interest income with the potential for modest capital growth by As at December 31, 2020, had prevailing interest rates risen investing primarily in a portfolio of diversified investment- or lowered by 1%, with all other factors kept constant, the grade fixed-income securities issued by U.S. corporations. Fund’s NAV may have decreased or increased, respectively, by approximately 8.5% (December 31, 2019 – 7.7%). In practice, Financial instrument risk and capital management actual results could differ from this sensitivity analysis and (see note 5 in the generic notes) the difference could be material. Credit risk (%) Fair value hierarchy (USD000s except % amounts) The table below summarizes the Fund’s credit risk exposure (see note 3 in the generic notes) grouped by credit ratings as at: The following is a summary of the inputs used as of December 31 December 31 December 31, 2020 and 2019. Rating 2020 2019 AAA 0.3 2.8 December 31, 2020 Level 1 Level 2 Level 3 Total AA 5.4 3.8 Equities – – – – A 34.4 34.1 Underlying funds – – – – BBB 57.6 57.7 Fixed-income BB 2.3 1.6 and debt securities – 271 638 – 271 638 Total 100.0 100.0 Short-term investments – – – – Derivatives – assets – – – – Concentration risk (%) Derivatives – liabilities – – – – The table below summarizes the Fund’s investment exposure Total financial instruments – 271 638 – 271 638 % of total portfolio – 100.0 – 100.0 (after consideration of derivative products, if any) as at:

December 31 December 31 Investment mix 2020 2019 December 31, 2019 Level 1 Level 2 Level 3 Total United States 82.9 83.9 Equities – – – – United Kingdom 3.6 3.7 Underlying funds – – – – Canada 3.5 2.7 Fixed-income Australia 2.3 0.9 and debt securities – 221 711 – 221 711 Netherlands 1.8 2.3 Short-term investments – – – – France 1.6 1.8 Derivatives – assets – – – – Japan 0.8 0.3 Derivatives – liabilities – – – – Switzerland 0.7 1.6 Total financial instruments – 221 711 – 221 711 Finland 0.5 – % of total portfolio – 100.0 – 100.0 Ireland 0.2 0.4 For the periods ended December 31, 2020 and 2019, there Other Countries – 0.2 were no transfers of financial instruments between Level 1, Cash/Other 2.1 2.2 Total 100.0 100.0 Level 2 and Level 3.

Please see the generic notes at the back of the financial statements. NOTES TO FINANCIAL STATEMENTS – FUND SPECIFIC INFORMATION RBC $U.S. INVESTMENT GRADE CORPORATE BOND FUND

December 31, 2020

Management fees and administration fees For the periods ended December 31 (see note 2 in the generic notes) 2020 2019 (see note 8 in the generic notes) Advisor Series Management fees and administration fees of each series Opening units 98 59 of the Fund are payable to RBC GAM and calculated at the Issued number of units 68 68 following annual percentages, before GST/HST, of the daily Reinvested number of units 2 1 NAV of each series of the Fund. Redeemed number of units (122) (30) Ending number of units 46 98 Management fees Administration fees Series D Series A 1.10% 0.05% Opening units 296 177 Advisor Series 1.10% 0.05% Issued number of units 282 208 Series D 0.75% 0.05% Reinvested number of units 7 6 Series F 0.60% 0.05% Redeemed number of units (274) (95) Series O n/a* 0.02% Ending number of units 311 296 * Series O unitholders pay a negotiated management fee directly to RBC GAM for Series F investment-counselling services. Opening units 1 738 1 428 Issued number of units 4 005 1 306 Investments by related parties Reinvested number of units 53 24 (USD000s except unit amounts) Redeemed number of units (1 809) (1 020) Royal Bank of Canada, or one of its subsidiaries, held the Ending number of units 3 987 1 738 following investments in the Fund as at: Series O Opening units 14 907 12 464 December 31 December 31 Issued number of units 5 803 4 317 2020 2019 Reinvested number of units 211 152 Units held Redeemed number of units (5 221) (2 026) Series A 263 129 Ending number of units 15 700 14 907 Advisor Series – 130 Series F 137 133 Value of all units 4 4 Securities lending revenue (USD000s except %) (see note 7 in the generic notes) Taxes (CAD000s) (see note 6 in the generic notes) Fair value of securities on loan and collateral received as at:

The Fund prepares its financial statements in U.S. dollars December 31 December 31 but is taxable on its income and net realized capital gains 2020 2019 Fair value of securities loaned 4 537 7 835 (including gains from foreign exchange movements) Fair value of collateral received 4 627 7 992 calculated on a Canadian dollar basis.

The non-capital and capital losses as at December 31, 2020 The table below provides a reconciliation of the gross revenue for the Fund were approximately: generated from the securities lending transactions of the Fund to the securities lending revenue disclosed in the Statements of Capital losses 2 543 Comprehensive Income. Non-capital losses – December 31 December 31 2020 2019 Redeemable units (000s) $ % $ % Gross revenue 5 100 2 100 There is no limitation on the number of units available for RBC IS (paid) (1) (25) – (25) issue. Units are purchased and redeemed at the NAV per unit. Tax withheld – – – – For the periods ended December 31 Fund revenue 4 75 2 75 (see note 2 in the generic notes) 2020 2019 Series A Investments by other related investment funds (%) Opening units 5 580 2 027 (see note 8 in the generic notes) Issued number of units 3 850 4 815 Reinvested number of units 107 78 The table below summarizes, as a percentage, the NAV of the Redeemed number of units (3 506) (1 340) Fund owned by other related investment funds as at: Ending number of units 6 031 5 580 December 31 December 31 2020 2019 Please see the generic notes at the back of the financial statements. RBC $U.S. Strategic Income Bond Fund 7.2 7.2 GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020

1. The Funds Series I units have no sales charges, have lower fees than The Funds (“Fund” or “Funds”) are open-ended mutual Series F units, Series FT5 units and Series FT8 units and fund trusts governed by the laws of the Province of Ontario are only available to investors who invest and maintain or British Columbia. RBC GAM is the manager and portfolio the required minimum balance and who have accounts manager of the Funds and its head office is located at with dealers who have signed a fee-based agreement with 155 Wellington Street West, 22nd Floor, Toronto, Ontario. RBC GAM. RBC GAM is also the trustee of those Funds governed by the Series N units are only available to related funds. laws of the Province of Ontario. These financial statements were approved for issuance by the Board of Directors of Series O units are only available to large private or RBC GAM on March 11, 2021. institutional investors or dealers. No management fees are payable by the Funds in respect to Series O units. The Funds may issue an unlimited number of units in some Unitholders pay a negotiated fee directly to RBC GAM for or all of Series A, Advisor Series, Advisor T5 Series, Series T5, investment-counselling services. Series T8, Series H, Series D, Series DZ, Series F, Series FT5, Series FT8, Series I, Series N and Series O. 2. Financial year

Series A units have no sales charges and are available to all The information provided in these financial statements investors through authorized dealers. and notes thereto is as at December 31, 2020 and December 31, 2019, as applicable, and for the 12-month Advisor Series units and Advisor T5 Series units are available periods ended December 31, 2020 and December 31, 2019, as to all investors through authorized dealers with an initial applicable, except for Funds or series established during either sales charge or low-load sales charge option. For certain of period, in which case the information for the Fund, or series, is the Funds, Advisor Series units and Advisor T5 Series units are provided for the period from the start date as described in the available with a deferred sales charge option. Under the initial Notes to Financial Statements – Fund Specific Information of sales charge option, investors pay a sales charge ranging from the Fund. 0% to 5% of the amount invested. Under the deferred sales charge or low-load sales charge option, sales charges may be 3. Summary of significant accounting policies applicable, as described in the Simplified Prospectus. These financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”). Series T5 units and Series T8 units have no sales charges and The significant accounting policies of the Funds are are available to all investors through authorized dealers. as follows: Series H units have no sales charges, have lower fees than Classification and Measurement of Financial Assets, Series A units and are only available to investors who invest Liabilities and Derivatives Each of the Funds classify and maintain the required minimum balance through their investment portfolio based on the business model authorized dealers. for managing the portfolio and the contractual cash flow Series D units and Series DZ units have no sales charges characteristics. The investment portfolio of financial assets and have lower fees than Series A units. Series D units and and liabilities is managed and performance is evaluated on Series DZ units may be available to investors who have a fair value basis. The contractual cash flows of the Funds’ accounts with RBC Direct Investing Inc., Phillips, Hager & debt securities that are solely principal and interest are North Investment Funds Ltd. (“PH&N IF”) or certain other neither held for the purpose of collecting contractual cash authorized dealers (primarily discount brokers). flows nor held both for collecting contractual cash flows Series F units, Series FT5 units and Series FT8 units have no and for sale. The collection of contractual cash flows is only sales charges and have lower fees than Series A units. Series F incidental to achieving the Funds’ business model objectives. units, Series FT5 units and Series FT8 units are only available Consequently, all investments are measured at fair value to investors who have fee-based accounts with their dealer. through profit and loss (“FVTPL”). Derivative assets and liabilities are also measured at FVTPL. GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020

The Funds’ obligation for net assets attributable to holders The Funds do not consolidate their investment in underlying of redeemable units represents a financial liability and is funds but account for these investments at fair value. The measured at the redemption amount, which approximates manager has determined that the Funds are investment fair value as of the reporting date. All other financial assets entities in accordance with IFRS 10 Consolidated Financial and liabilities are measured at amortized cost. Statements, since the Funds meet the following criteria:

Offsetting Financial Assets and Liabilities In the normal (i) The Funds obtain capital from one or more investors for course of business, the Funds may enter into various the purpose of providing those investors with investment International Swaps and Derivatives Association master management services, netting agreements or other similar arrangements with (ii) The Funds commit to their investors that their business certain counterparties that allow for related amounts to purpose is to invest funds solely for the returns from be offset in certain circumstances, such as bankruptcy or capital appreciation, investment income or both, and termination of contracts. Offsetting information, where applicable, is presented in the Notes to Financial (iii) The Funds measure and evaluate the performance of Statements – Fund Specific Information. substantially all of their investments on a fair value basis.

Classification of Redeemable Units The Funds have multiple Therefore, the fair value of investments in the underlying features across the different series of the Funds. Consequently, funds is included in the Schedule of Investment Portfolio the Funds’ outstanding redeemable units are classified as and included in “Investments at fair value” in the Funds’ financial liabilities in accordance with the requirements of Statements of Financial Position. The change in fair value IAS 32 Financial Instruments: Presentation. of the investment held in the underlying funds is included in “Change in unrealized gain (loss) on investments” in the Unconsolidated Structured Entities The Funds may invest in Statements of Comprehensive Income. other Funds and exchange-traded funds (“ETFs”) managed by the manager or an affiliate of the manager (“sponsored Certain Funds may invest in mortgage-related or other funds”) and may invest in other funds and ETFs managed asset-backed securities. These securities include commercial by unaffiliated entities (“unsponsored funds”); collectively, mortgage-backed securities, asset-backed securities, “underlying funds.” The underlying funds are determined to collateralized debt obligations and other securities that be unconsolidated structured entities, as decision making directly or indirectly represent a participation in, or are in the underlying fund is not governed by the voting rights securitized by and payable from, mortgage loans on real or other similar rights held by the Fund. The investments property. Mortgage-related securities are created from in underlying funds are subject to the terms and conditions pools of residential or commercial mortgage loans while of the offering documents of the respective underlying asset-backed securities are created from many types of funds and are susceptible to market price risk arising from assets, including auto loans, credit card receivables, home uncertainties about future values of those underlying funds. equity loans and student loans. The Funds account for these The underlying funds’ objectives are generally to achieve investments at fair value. The fair value of such securities, as long-term capital appreciation and/or current income by disclosed in the Schedule of Investment Portfolio, represents investing in a portfolio of securities and other funds in line the maximum exposure to losses at that date. with each of their documented investment strategies. The Determination of Fair Value The fair value of a financial underlying funds apply various investment strategies to instrument is the amount at which the financial instrument accomplish their respective investment objectives. could be exchanged in an arm’s-length transaction between The underlying funds finance their operations by issuing knowledgeable and willing parties under no compulsion to redeemable units which are puttable at the unitholder’s act. In determining fair value, a three-tier hierarchy based on option, and entitle the unitholder to a proportional stake in inputs is used to value the Funds’ financial instruments. the respective underlying funds’ NAV. The hierarchy of inputs is summarized below: GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020

Level 1 – quoted prices (unadjusted) in active markets for Options purchased and options written (sold) are recorded identical assets or liabilities; as investments in the Statements of Financial Position. These investments are reported at fair value in the Statements of Level 2 – inputs other than quoted prices included in Financial Position, and unrealized gain or loss at the close Level 1 that are observable for the asset or liability, either of business on each valuation date is recorded in “Change in directly (i.e., as prices) or indirectly (i.e., derived from prices), unrealized gain (loss) on investments” in the Statements of including broker quotes, vendor prices and vendor fair value Comprehensive Income. factors; and When an option is exercised and the underlying securities Level 3 – inputs for the asset or liability that are not based on are acquired or delivered, the acquisition cost or sale observable market data (unobservable inputs). proceeds are adjusted by the amount of the premium. Changes in valuation methods may result in transfers into or When an option is closed the Fund will realize a gain or out of an investment’s assigned level. loss equal to the difference between the premium and the cost to close the position. When an option expires, gains or The three-tier hierarchy of investments and derivatives is losses are realized equivalent to the amount of premiums included in Notes to Financial Statements – Fund Specific received or paid, respectively. The net realized gains (losses) Information. on written and purchased options are included in the Investments and derivatives are recorded at fair value, which Statements of Comprehensive Income in “Net realized gain is determined as follows: (loss) on investments.”

Equities – Common shares and preferred shares are valued at Warrants – Warrants are valued using a recognized option the closing price recorded by the security exchange on which pricing model, which includes factors such as the terms of the security is principally traded. In circumstances where the the warrant, time value of money and volatility inputs that are closing price is not within the bid-ask spread, management will significant to such valuation. determine the points within the bid-ask spread that are most Forward Contracts – Forward contracts are valued at the gain or representative of the fair value. loss that would arise as a result of closing the position at the Fixed-Income and Debt Securities – Bonds, mortgage-backed valuation date. The receivable/payable on forward contracts securities, loans, debentures and other debt securities are is recorded separately in the Statements of Financial Position. valued at the mid price quoted by major dealers or independent Any unrealized gain or loss at the close of business on each valuation date is recorded as “Change in unrealized gain (loss) pricing vendors in such securities. on investments” and realized gain or loss on foreign exchange NHA-approved mortgages are valued at an amount, which contracts is included in “Derivative income” in the Statements produces a yield equivalent to the prevailing rate of return on of Comprehensive Income. mortgages of similar type and term. Total Return Swaps – A total return swap is an agreement by Short-Term Investments – Short-term investments are valued at which one party makes payments based on a set rate, either cost plus accrued interest, which approximates fair value. fixed or variable, while the other party makes payments based Options – Options give the purchaser the right, but not the on the return of an underlying asset, which includes both the obligation, to buy (call) or sell (put) an underlying security income it generates and any capital gains. Total return swap or financial instrument at an agreed exercise or strike price contracts are marked to market daily based upon quotations during the specified period or on a specified date. from the market makers and the change in value, if any, is recorded in “Change in unrealized gain (loss) on investments” Listed options are valued at the closing price on the recognized in the Statements of Comprehensive Income. When the swap exchange on which the option is traded. In circumstances contract is terminated early, the Fund records a realized where the closing price is not within the bid-ask spread, gain or loss equal to the difference between the current net management will determine the points within the present value and the executed net present value in “Derivative bid-ask spread that are most representative of the fair value. income” in the Statements of Comprehensive Income. GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020

Unrealized gains and losses are recorded as “Receivable on to determine the fair value of foreign securities traded in open swap contracts” or “Payable on open swap contracts” countries outside of North America daily to avoid stale prices in the Statements of Financial Position, as applicable. The and to take into account, among other things, any significant risks of total return swap contracts include changes in market events occurring after the close of a foreign market. conditions and the possible inability of the counterparty to Management also has procedures where the Funds primarily fulfill its obligations under the agreement. employ a market-based approach, which may use related Futures Contracts – Futures contracts entered into by the or comparable assets or liabilities, NAV per unit (for Funds are financial agreements to purchase or sell a financial exchange-traded funds), recent transactions, market instrument at a contracted price on a specified future date. multiples, book values and other relevant information for However, the Funds do not intend to purchase or sell the the investment to determine its fair value. The Funds may financial instrument on the settlement date; rather, they also use an income-based valuation approach in which intend to close out each futures contract before settlement the anticipated future cash flows of the investment are by entering into equal, but offsetting, futures contracts. discounted to calculate fair value. Discounts may also be Futures contracts are valued at the gain or loss that would applied due to the nature or duration of any restrictions arise as a result of closing the position at the valuation date. on the disposition of the investments, but only if they arise Any gain or loss at the close of business on each valuation as a feature of the instrument itself. Due to the inherent date is recorded as “Derivative income” in the Statements uncertainty of valuations of such investments, the fair values of Comprehensive Income. The receivable/payable on may differ significantly from the values that would have been futures contracts is recorded separately in the Statements of used had an active market existed. Financial Position. All security valuation techniques are periodically reviewed Credit Default Swap Contracts – Credit default swaps are by the Valuation Committee (“VC”) of the manager and are agreements between a protection buyer and protection approved by the manager. The VC provides oversight of the seller. The protection buyer pays a periodic fee in exchange Funds’ valuation policies and procedures. for a payment by the protection seller contingent on the Cash Cash is comprised of cash and deposits with banks and occurrence of a credit event, such as a default, bankruptcy is recorded at amortized cost. The carrying amount of cash or restructuring, with respect to a referenced entity. approximates its fair value because it is short term in nature. Periodic fees paid or received are recorded as “Interest for distribution purposes” in the Statements of Comprehensive Margin Margin accounts represent margin deposits held with Income. When the contract is terminated or expires, the brokers in respect of derivatives contracts. payments received or paid are recorded as “Derivative Functional Currency The Funds, with the exceptions below, income” in the Statements of Comprehensive Income. have their subscriptions, redemptions and performance Credit default swap contracts are valued based on quotations denominated in Canadian dollars and, consequently, the from independent sources. Canadian dollar is the functional currency for the Funds. Underlying Funds – Underlying funds that are not exchange- Phillips, Hager & North $U.S. Money Market Fund, traded funds are valued at their respective NAV per unit RBC $U.S. Money Market Fund, RBC Premium $U.S. from fund companies on the relevant valuation dates and Money Market Fund, RBC $U.S. Short-Term Corporate underlying funds that are exchange-traded funds are valued Bond Fund, RBC $U.S. Investment Grade Corporate Bond at market close on the relevant valuation dates. Fund, RBC $U.S. High Yield Bond Fund, RBC $U.S. Strategic Income Bond Fund, BlueBay Emerging Markets Bond Fund Fair Valuation of Investments – The Funds have procedures (Canada), BlueBay Emerging Markets Local Currency Bond to determine the fair value of securities and other financial Fund (Canada), BlueBay Emerging Markets Corporate Bond instruments for which market prices are not readily available Fund, BlueBay $U.S. Global Convertible Bond Fund (Canada) or which may not be reliably priced. Procedures are in place and RBC U.S. Monthly Income Fund (collectively, the “USD Funds”) have their subscriptions, redemptions and performance denominated in U.S. dollars and, consequently, the U.S. dollar is the functional currency for these Funds. GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020

Foreign Exchange The value of investments and other Increase (Decrease) in NAV per Unit Increase (decrease) in assets and liabilities in foreign currencies is translated NAV per unit in the Statements of Comprehensive Income into Canadian dollars (U.S. dollars in the case of the USD represents the increase (decrease) in net assets attributable to Funds) at the rate of exchange on each valuation date. holders of redeemable units by series, divided by the average Gains/losses on foreign cash balances are included in “Net units outstanding per series during the period. gain (loss) on foreign cash balances” in the Statements of Early Redemption Fees Early redemption fees (short-term Comprehensive Income. Purchases and sales of investments, trading fees) are paid directly to a Fund and are designed income and expenses are translated at the rate of exchange to deter excessive trading and its associated costs. With the prevailing on the respective dates of such transactions. exception of money market funds, a Fund may apply a fee Realized foreign exchange gains/losses on spot and forward of 2% of the current value of units if the unitholder redeems currency contracts are included in “Derivative income” in the or switches out units within seven days of purchasing Statements of Comprehensive Income. or previously switching into a Fund. These amounts are Valuation of Series A different NAV is calculated for each included in the Statements of Changes in NAV. series of units of a Fund. The NAV of a particular series of Foreign Currencies The following is a list of abbreviations units is computed by calculating the value of the series’ used in the Schedule of Investment Portfolio: proportionate share of the assets and liabilities of the Fund common to all series less the liabilities of the Fund attributable AUD – Australian dollar KZT – Kazakhstan tenge only to that series. Expenses directly attributable to a series BRL – Brazilian real MXN – Mexican peso CAD – Canadian dollar MYR – Malaysian ringgit are charged to that series. Other expenses are allocated CHF – Swiss franc NOK – Norwegian krone proportionately to each series based upon the relative NAV of CLP – Chilean peso NZD – New Zealand dollar each series. Expenses are accrued daily. CNH/CNY – Chinese renminbi PEN – Peruvian nuevo sol COP – Colombian peso PHP – Philippine peso Investment Transactions Investment transactions are CZK – Czech koruna PLN – Polish zloty DKK – Danish krone RON – Romanian leu accounted for as of the trade date. Transaction costs, such as EUR – Euro RUB – Russian ruble brokerage commissions, incurred by the Funds are recorded GBP – Pound sterling SEK – Swedish krona in the Statements of Comprehensive Income for the period. HKD – Hong Kong dollar SGD – Singapore dollar The unrealized gain and loss on investments is the difference HUF – Hungarian forint THB – Thailand baht IDR – Indonesian rupiah TRY – Turkish new lira between fair value and average cost for the period. The basis ILS – Israeli new shekel TWD – New Taiwan dollar of determining the cost of portfolio assets, and realized INR – Indian rupee USD – United States dollar and unrealized gains and losses on investments, is average JPY – Japanese yen UYU – Uruguay peso KRW – South Korean won ZAR – South African rand cost which does not include amortization of premiums or discounts on fixed-income and debt securities with the 4. Critical accounting judgments and estimates exception of zero coupon bonds. The preparation of financial statements requires the use Income Recognition Dividend income is recognized on the of judgment in applying the Funds’ accounting policies ex-dividend date and interest for distribution purposes is and making estimates and assumptions about the future. coupon interest recognized on an accrual basis and/or The following discusses the most significant accounting imputed interest on zero coupon bonds. “Income from judgments and estimates that management has made in investment trusts” includes income from underlying funds preparing the financial statements. and other trusts. Any premiums paid or discounts received Fair value measurement of securities not quoted in an active market on the purchase of zero coupon bonds are amortized. Interest The Funds have established policies and control procedures payments made by the Funds to counterparties on the that are intended to ensure these estimates are well payable leg of derivative contracts are recorded as “Interest controlled, independently reviewed and consistently applied expense” in the Statements of Comprehensive Income. from period to period. The estimates of the value of the Funds’ assets and liabilities are believed to be appropriate as at the reporting date. GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020

The Funds may hold financial instruments that are not quoted Credit risk in active markets. Note 3 discusses the policies used by Credit risk is the risk that a loss could arise from a security management for the estimates used in determining fair value. issuer or counterparty not being able to meet its financial obligations. The carrying amount of investments and other 5. Financial instrument risk and capital management assets represents the maximum credit risk exposure as RBC GAM is responsible for managing each Fund’s disclosed in a Fund’s Statements of Financial Position. The capital, which is its NAV and consists primarily of Funds measure credit risk and expected credit losses using its financial instruments. probability of default, exposure at default and loss given A Fund’s investment activities expose it to a variety of default. Management considers both historical analysis and financial risks. RBC GAM seeks to minimize potential adverse forward-looking information in determining any expected effects of these risks on a Fund’s performance by employing credit loss. All other receivables, amounts due from brokers, professional, experienced portfolio managers, daily monitoring cash and short-term deposits are held with counterparties of the Fund’s holdings and market events, diversifying its with a credit rating of AA/Aa or higher. Management investment portfolio within the constraints of its investment considers the probability of default to be close to zero as objectives and, in some cases, periodically hedging certain risk the counterparties have a strong capacity to meet their exposures through the use of derivatives. To assist in managing contractual obligations in the near term. As a result, no risks, RBC GAM also uses internal guidelines, maintains a loss allowance has been recognized based on 12-month governance structure that oversees each Fund’s investment expected credit losses as any such impairment would be activities and monitors compliance with the Fund’s investment wholly insignificant to the Funds. The fair value of fixed- strategies, internal guidelines and securities regulations. income and debt securities includes a consideration of the creditworthiness of the debt issuer. Credit risk exposure The financial markets experienced significant volatility to over-the-counter derivative instruments is based on a as a result of the developing COVID‑19 global pandemic. Fund’s unrealized gain on the contractual obligations with The effects of the pandemic and its impact on individual the counterparty. Credit risk exposure is mitigated for those companies, nations and the market in general can not Funds participating in a securities lending program (see necessarily be foreseen at the present time and may have an note 7). RBC GAM monitors each Fund’s credit exposure and adverse impact on the financial performance of the Funds. The counterparty ratings daily. impact of the pandemic may be short-term or may last for an extended period of time. Concentration risk Concentration risk arises as a result of net financial Financial instrument risk, as applicable to a Fund, is disclosed instrument exposures to the same category, such as in its Notes to Financial Statements – Fund Specific Information. geographical region, asset type, industry sector or market These risks include a Fund’s direct risks and pro rata exposure to segment. Financial instruments in the same category have the risks of underlying funds, as applicable. similar characteristics and may be affected similarly by Liquidity risk changes in economic or other conditions. Liquidity risk is the possibility that investments in a Fund Interest rate risk cannot be readily converted into cash when required. A Fund Interest rate risk is the risk that the fair value of a Fund’s is exposed to daily cash redemptions of redeemable units. interest-bearing investments will fluctuate due to changes Liquidity risk is managed by investing the majority of a Fund’s in market interest rates. The value of fixed-income and debt assets in investments that are traded in an active market and securities, such as bonds, debentures, mortgages or other that can be readily disposed. In accordance with securities income-producing securities, is affected by interest rates. regulations, a Fund must maintain at least 90% of its assets in Generally, the value of these securities increases if interest liquid investments. In addition, a Fund aims to retain sufficient rates fall and decreases if interest rates rise. cash and cash equivalent positions to maintain liquidity, and has the ability to borrow up to 5% of its NAV for the purpose of funding redemptions. All non-derivative financial liabilities, other than redeemable units, are due within 90 days. GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020

Currency risk 7. Securities lending revenue Currency risk is the risk that the value of investments Certain of the Funds lend portfolio securities from time denominated in currencies, other than the functional to time in order to earn additional income. Income currency of a Fund, will fluctuate due to changes in foreign from securities lending is included in the Statements of exchange rates. The value of investments denominated in a Comprehensive Income of a Fund. Each such Fund will have currency other than the functional currency is affected by entered into a securities lending program with its custodian, changes in the value of the functional currency in relation RBC Investor Services Trust (“RBC IS”). The aggregate market to the value of the currency in which the investment is value of all securities loaned by a Fund cannot exceed 50% denominated. When the value of the functional currency falls of the assets of a Fund. The Fund receives collateral, with an in relation to foreign currencies, then the value of the foreign approved credit rating of at least A, of at least 102% of the investments rises. When the value of the functional currency value of securities on loan. The Fund is indemnified by RBC IS rises, the value of the foreign investments falls. The currency for any collateral credit or market loss. As such, the credit risk risk as disclosed in the Fund Specific Information in the associated with securities lending is considered minimal. Notes to Financial Statements represents the monetary and 8. Administrative and other non-monetary foreign exchange exposure of a Fund. related-party transactions Other price risk Manager and Portfolio Manager Other price risk is the risk that the value of financial RBC GAM is an indirect wholly owned subsidiary of instruments will fluctuate as a result of changes in market Royal Bank of Canada (“Royal Bank”). RBC GAM is the prices (other than those arising from interest rate or currency manager and portfolio manager of the Funds. RBC GAM is risk), whether caused by factors specific to an individual responsible for the Funds’ day-to-day operations, provides investment, its issuer, or all factors affecting all instruments investment advice and portfolio management services to the traded in a market or market segment. Funds and appoints distributors for the Funds. RBC GAM is paid a management fee by the Funds as compensation 6. Taxes for its services. The management fee is calculated and The Funds qualify as open-ended mutual fund trusts or unit accrued daily as a percentage of the NAV of each series trusts under the Income Tax Act (Canada). In general, the of units of the Funds. No management fees are paid by Funds are subject to income tax; however, no income tax the Funds with respect to Series O units. Unitholders of is payable on net income and/or net realized capital gains Series O units pay a negotiated fee directly to RBC GAM for which are distributed to unitholders. Since the Funds do investment-counselling services. not record income taxes, the tax benefit of capital and non-capital losses has not been reflected in the Statements The Funds pay a fixed administration fee to RBC GAM. The of Financial Position as a deferred income tax asset. In fixed administration fee is calculated and accrued daily as a addition, for mutual fund trusts, income taxes payable on percentage of the NAV of each series of units of the Funds. net realized capital gains are refundable on a formula basis RBC GAM in turn pays certain operating expenses of the when units of the Funds are redeemed. It is the intention of Funds. These expenses include regulatory filing fees and the Funds to pay out all net income and realized capital gains other day-to-day operating expenses including, but not each year so that the Funds will not be subject to income limited to, recordkeeping, accounting and fund valuation taxes. Accordingly, no provision for income taxes is recorded. costs, custody fees, audit and legal fees and the costs of preparing and distributing annual and interim reports, Capital losses are available to be carried forward indefinitely prospectuses, statements and investor communications. and applied against future capital gains. Non-capital losses may be carried forward to reduce future taxable income for Notwithstanding the fixed administration fee, the Funds up to 20 years. also pay certain operating expenses directly, including the costs related to the Independent Review Committee of the Funds, and the cost of any new government or regulatory requirements introduced and any borrowing costs (collectively, “other fund costs”), and taxes (including, but not GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020 limited to, GST/HST). Effective January 1, 2020, RBC GAM, RBC Bond Fund (for a portion of the Fund) not the Funds, will be responsible for the costs related to RBC $U.S. Investment Grade Corporate Bond Fund annual fees, meeting fees and reimbursement for expenses to RBC Global Corporate Bond Fund (for a portion of the Fund) members of the Independent Review Committee. The Funds RBC U.S. Monthly Income Fund (for a portion of the Fund) will continue to be responsible for paying any Independent RBC U.S. Mid-Cap Growth Equity Fund Review Committee costs that are not related to annual fees, RBC U.S. Mid-Cap Growth Equity Currency Neutral Fund meeting fees and reimbursement for expenses to members RBC U.S. Mid-Cap Value Equity Fund of the Independent Review Committee. Other fund costs will RBC U.S. Small-Cap Core Equity Fund be allocated proportionately to each series based upon the RBC U.S. Small-Cap Value Equity Fund relative NAV of each series. RBC GAM may, in some years Phillips, Hager & North U.S. Multi-Style All-Cap Equity Fund and in certain cases, absorb a portion of operating expenses. RBC Global Asset Management (UK) Limited is the The decision to absorb the operating expenses is reviewed sub-advisor for: annually and determined at the discretion of RBC GAM, RBC Bond Fund (for a portion of the Fund) without notice to unitholders. RBC Global Bond Fund (for a portion of the Fund) Certain Funds may invest in units of other Funds managed RBC Global Corporate Bond Fund (for a portion of the Fund) by RBC GAM or its affiliates (“underlying funds”). A Fund will RBC Global High Yield Bond Fund (for a portion of the Fund) not invest in units of an underlying fund if the Fund would be RBC Emerging Markets Bond Fund (for a portion of the Fund) required to pay any management or incentive fees in respect RBC U.S. Monthly Income Fund (for a portion of the Fund) of that investment that a reasonable person would believe RBC Balanced Fund (for a portion of the Fund) duplicates a fee payable by the underlying fund for the same RBC Global Balanced Fund (for a portion of the Fund) service. To the extent a Fund invests in underlying funds RBC Vision Balanced Fund (for a portion of the managed by RBC GAM or its affiliates, the fees and expenses underlying funds) payable by the underlying funds are in addition to the fees RBC International Dividend Growth Fund (for a portion and expenses payable by the Fund. However, a Fund may of the Fund) only invest in one or more underlying funds provided that no RBC International Equity Fund (for the European equity management fees or incentive fees are payable that would portion of the Fund) duplicate a fee payable by the underlying fund for the same RBC International Equity Currency Neutral Fund (for the service. The Fund’s ownership interest in underlying funds European equity portion of the underlying fund) is disclosed in the Notes to Financial Statements – Fund RBC European Dividend Fund Specific Information. RBC European Equity Fund RBC European Mid-Cap Equity Fund RBC GAM or its affiliates may earn fees and spreads in RBC Emerging Markets Multi-Strategy Equity Fund connection with various services provided to, or transactions (for the underlying funds) with, the Funds, such as banking, brokerage, securities RBC Emerging Markets Dividend Fund lending, foreign exchange and derivatives transactions. RBC Emerging Markets Equity Fund RBC GAM or its affiliates may earn a foreign exchange RBC Emerging Markets Equity Focus Fund spread when unitholders switch between series of funds denominated in different currencies. The Funds also RBC Emerging Markets Small-Cap Equity Fund maintain bank accounts and overdraft provisions with Royal RBC Global Dividend Growth Fund Bank for which Royal Bank may earn a fee. Affiliates of RBC Global Dividend Growth Currency Neutral Fund RBC GAM that provide services to the Funds in the course RBC Global Equity Fund of their normal business, all of which are wholly owned RBC Global Equity Focus Fund subsidiaries of Royal Bank of Canada, are discussed below. RBC Global Equity Focus Currency Neutral Fund (for the underlying fund) Sub-Advisors RBC Vision Global Equity Fund RBC Global Asset Management (U.S.) Inc. is the sub-advisor for: RBC Vision Fossil Fuel Free Global Equity Fund RBC $U.S. Short-Term Corporate Bond Fund Phillips, Hager & North Overseas Equity Fund (for the underlying fund) Phillips, Hager & North Global Equity Fund GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020

RBC Global Asset Management (Asia) Limited is the Distributors sub-advisor for: RBC GAM, Royal Mutual Funds Inc., RBC Direct Investing Inc., RBC Balanced Fund (for the Asian equity portion of the Fund) RBC Dominion Securities Inc. and PH&N IF are principal RBC Global Balanced Fund (for the Asian equity portion distributors of, or may distribute certain series of units of, the of the Fund) Funds. Dealers receive an ongoing commission based on RBC Vision Balanced Fund (for the Asian equity portion the total value of their clients’ Series A, Advisor Series, of the underlying funds) Advisor T5 Series, Series T5, Series T8, Series H and RBC International Dividend Growth Fund (for the Asian Series D units. equity portion of the Fund) Custodian RBC International Equity Fund (for the Asian equity RBC IS is the custodian and holds the assets of the Funds. portion of the Fund) RBC IS earns a fee as the custodian, which is paid by the RBC International Equity Currency Neutral Fund (for the manager from the fixed administration fee paid by the Funds. Asian equity portion of the underlying fund) RBC Asian Equity Fund (for the underlying funds) Registrars RBC Asia Pacific ex-Japan Equity Fund RBC GAM, RBC IS or Royal Bank (or a combination thereof) RBC China Equity Fund are the registrars of the Funds and keep records of who owns RBC Japanese Equity Fund the units of the Funds. The registrars also process orders and BlueBay Asset Management LLP is the sub-advisor for: issue account statements. The registrars earn a fee, which is BlueBay Global Monthly Income Bond Fund paid by the manager from the fixed administration fee paid BlueBay Global Sovereign Bond Fund (Canada) by the Funds. BlueBay Global Investment Grade Corporate Bond Brokers and Dealers Fund (Canada) The Funds have established or may establish standard BlueBay European High Yield Bond Fund (Canada) brokerage agreements and dealing agreements at BlueBay Emerging Markets Bond Fund (Canada) market rates with related parties such as RBC Dominion BlueBay Emerging Markets Local Currency Bond Securities Inc., RBC Capital Markets, LLC, RBC Europe Fund (Canada) Limited, NBC Securities Inc. and Royal Bank of Canada. BlueBay Emerging Markets Corporate Bond Fund BlueBay Global Convertible Bond Fund (Canada) Securities Lending Agent BlueBay $U.S. Global Convertible Bond Fund (Canada) To the extent a Fund may engage in securities lending BlueBay Global Alternative Bond Fund (Canada) transactions, RBC IS may act as the Fund’s securities lending agent. Any revenue earned on such securities lending is split The sub-advisors earn a fee which is calculated and accrued between the Fund and the securities lending agent. daily as a percentage of the NAV of each series of units of the Funds. The sub-advisors are paid by the manager from the Other Related-Party Transactions management fee paid by the Funds. Pursuant to applicable securities legislation, the Funds Trustee relied on the standing instructions from the Independent Review Committee with respect to one or more of the RBC GAM is the trustee for the Funds governed by the laws following transactions: of the Province of Ontario. RBC IS is the trustee for the Funds governed by the laws of the Province of British Columbia. Related-Party Trading Activities The trustee holds title to the Funds’ property on behalf of (a) trades in securities of Royal Bank; the unitholders. The trustee earns a fee, which is paid by the (b) investments in the securities of issuers for which manager from the fixed administration fee paid by the Funds. a related-party dealer acted as an underwriter during the distribution of such securities and the 60-day period following the conclusion of such distribution of the underwritten securities to the public; GENERIC NOTES TO FINANCIAL STATEMENTS (also see Fund Specific Information)

December 31, 2020

(c) purchases of equity and debt securities from or sales of equity or debt securities to a related-party dealer, where it acted as principal; and

Inter-Fund Trading (d) purchases or sales of securities of an issuer from or to another investment fund or managed account managed by RBC GAM.

The applicable standing instructions require that Related-Party Trading Activities and Inter-Fund Trading be conducted in accordance with RBC GAM policy and that RBC GAM advise the Independent Review Committee of a material breach of any standing instruction. RBC GAM policy requires that an investment decision in respect of Related-Party Trading Activities (i) is made free from any influence of Royal Bank or its associates or affiliates and without taking into account any consideration relevant to Royal Bank or its affiliates or associates, (ii) represents the business judgment of the portfolio manager, uninfluenced by considerations other than the best interests of the Funds, (iii) is in compliance with RBC GAM policies and procedures, and (iv) achieves a fair and reasonable result for the Funds. RBC GAM policy requires that an investment decision in respect of Inter-Fund Trading is in the best interests of each Fund.