EX-12.1 5 dex121.htm STATEMENT REGARDING COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES Statement regarding computation of ratio of earnings to fixed charges

Exhibit 12.1

ALLY FINANCIAL INC.

RATIO OF EARNINGS TO FIXED CHARGES

Our consolidated ratio of earnings to fixed charges were as follows for the periods presented:

 

     Nine months
ended
September 30,
    Year Ended December 31,  
     2010(1)     2009(1)     2008(1)     2007(1)     2006(1)     2005(1)  
     ($ in millions)  

Earnings

            

Consolidated net income (loss) from continuing operations

   $ 836      $ (7,006   $ 4,902      $ (1,879   $ 1,863      $ 2,057   

Income tax expense (benefit) from continuing operations

     117        77        (131     514        31        1,084   

Equity-method investee distribution

     —          —          111        65        651        283   

Equity-method investee (losses) earnings

     (41     (10     533        5        (512     (142

Minority interest expense

     1        1        1        2        9        (57
                                                

Consolidated income (loss) from continuing operations before income taxes, minority interest, and income (loss) from equity investees

     913        (6,938     5,416        (1,293     2,042        3,225   

Fixed charges

     5,198        7,253        10,351        13,798        14,752        12,035   
                                                

Earnings available for fixed charges

   $ 6,111      $ 315      $ 15,767      $ 12,505      $ 16,794      $ 15,260   

Fixed charges

            

Interest, discount, and issuance expense on debt

   $ 5,170      $ 7,217      $ 10,298      $ 13,738      $ 14,686      $ 11,976   

Portion of rentals representative of the interest factor

     28        36        53        60        66        59   
                                                

Total fixed charges

     5,198        7,253        10,351        13,798        14,752        12,035   

Preferred dividend requirements

     975        1,224        —          192        22        —     
                                                

Total fixed charges and preferred dividend requirements

   $ 6,173      $ 8,477      $ 10,351      $ 13,990      $ 14,774      $ 12,035   

Ratio of earnings to fixed charges (2)

     1.18        0.04        1.52        0.91        1.14        1.27   

Ratio of earnings to combined fixed charges and preferred dividend requirements (3)

     0.99        0.04        1.52        0.89        1.14        1.27   
                                                

 

(1) During 2009, we committed to sell certain operations of our International Automotive Finance operations, Insurance operations, Mortgage operations, and Commercial Finance Group. We report these businesses separately as discontinued operations in the Condensed Consolidated Financial Statements. Refer to Note 2 to the Condensed Consolidated Financial Statements for further discussion of our discontinued operations. All reported periods of the calculation of the ratio of earnings to fixed charges exclude discontinued operations.
(2) The ratio indicates a less than one-to-one coverage for the years ended December 31, 2009 and 2007. Earnings available for fixed charges for the years ended December 31, 2009 and 2007, were inadequate to cover total fixed charges. The deficit amounts for the ratio were $6,938 million and $1,293 million for the years ended December 31, 2009 and 2007, respectively.
(3) The ratio indicates a less than one-to-one coverage for the nine months ended September 30, 2010, and the years ended December 31, 2009 and 2007. Earnings available for fixed charges and preferred dividend requirements for the nine months ended September 30, 2010, and the years ended December 31, 2009 and 2007, were inadequate to cover total fixed charges and preferred dividend requirements. The deficit amounts for the ratio were $62 million for the nine months ended September 30, 2010, and $8,162 million and $1,485 million for the years ended December 31, 2009 and 2007, respectively.