Exhibit 12
Principal Financial Group, Inc.
Computation of Earnings to Fixed Charges Ratio
The ratio of earnings to fixed charges is a measure of our ability to cover fixed costs with current period earnings. A high ratio indicates that earnings are sufficiently covering committed expenses. The following table sets forth, for the periods indicated, our ratios of: (1) earnings to fixed charges before interest credited on investment products and (2) earnings to fixed charges.
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For the year ended December 31, |
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2017 |
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2016 |
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2015 |
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2014 |
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2013 |
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(in millions) |
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1. |
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Income from continuing operations before income taxes |
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$ |
2,252.2 |
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$ |
1,591.7 |
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$ |
1,430.8 |
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$ |
1,494.9 |
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$ |
1,124.0 |
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2. |
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Interest expense |
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152.3 |
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165.8 |
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178.5 |
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135.5 |
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143.4 |
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3. |
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Interest factor of rental expense |
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7.1 |
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5.4 |
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4.9 |
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5.9 |
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5.7 |
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4. |
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Undistributed income from equity investees |
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(127.5 |
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(142.2 |
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(106.3 |
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(113.9 |
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(107.3 |
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5. |
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Earnings before interest credited on investment products |
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2,284.1 |
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1,620.7 |
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1,507.9 |
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1,522.4 |
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1,165.8 |
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6. |
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Interest credited on investment products |
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187.9 |
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173.9 |
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152.0 |
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189.6 |
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256.6 |
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7. |
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Earnings |
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$ |
2,472.0 |
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$ |
1,794.6 |
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$ |
1,659.9 |
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$ |
1,712.0 |
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$ |
1,422.4 |
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8. |
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Interest expense |
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$ |
152.3 |
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$ |
165.8 |
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$ |
178.5 |
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$ |
135.5 |
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$ |
143.4 |
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9. |
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Interest factor of rental expense |
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7.1 |
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5.4 |
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4.9 |
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5.9 |
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5.7 |
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10. |
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Preferred stock dividends by registrant |
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— |
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— |
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16.5 |
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33.0 |
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33.0 |
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11 |
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Excess of redemption value over carrying value of preferred shares redeemed |
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— |
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— |
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8.2 |
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— |
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— |
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12. |
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Fixed charges before interest credited on investment products |
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159.4 |
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171.2 |
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208.1 |
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174.4 |
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182.1 |
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13. |
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Interest credited on investment products |
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187.9 |
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173.9 |
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152.0 |
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189.6 |
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256.6 |
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14. |
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Fixed charges |
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$ |
347.3 |
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$ |
345.1 |
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$ |
360.1 |
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$ |
364.0 |
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$ |
438.7 |
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15. |
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Ratio of earnings to fixed charges before interest credited on investment products (Line item 5/Line item 12) |
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14.3 |
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9.5 |
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7.2 |
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8.7 |
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6.4 |
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16. |
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Ratio of earnings to fixed charges |
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7.1 |
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5.2 |
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4.6 |
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4.7 |
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3.2 |
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