EX-12 3 axp2017ex12.htm EX-12
 
 
EXHIBIT 12
 
AMERICAN EXPRESS COMPANY
COMPUTATION IN SUPPORT OF RATIO OF EARNINGS TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(Dollars in Millions)

 
   
2017
    
2016
    
2015
    
2014
    
2013
  
Earnings:
                              
Pretax income
  
$
7,414
    
$
8,096
    
$
7,938
    
$
8,991
    
$
7,888
  
Interest expense(a)
    
2,112
      
1,704
      
1,623
      
1,707
      
1,958
  
Other adjustments(b)
    
118
      
101
      
118
      
402
      
133
  
Total earnings
  
$
9,644
    
$
9,901
    
$
9,679
    
$
11,100
    
$
9,979
  
Fixed charges:
                                        
Interest expense
  
$
2,112
    
$
1,704
    
$
1,623
    
$
1,707
    
$
1,958
  
Other adjustments(c)
    
51
      
56
      
62
      
79
      
93
  
Total fixed charges
  
$
2,163
    
$
1,760
    
$
1,685
    
$
1,786
    
$
2,051
  
Preferred stock dividends(d)
    
219
      
80
      
62
      
―
      
―
  
Total fixed charges and preferred stock dividends
    
2,382
      
1,840
      
1,747
      
1,786
      
2,051
  
Ratio of earnings to fixed charges
    
4.46
      
5.63
      
5.74
      
6.22
      
4.87
  
Ratio of earnings to combined fixed charges and preferred stock dividends
    
4.05
      
5.38
      
5.54
      
6.22
      
4.87
  
(a)
Included in interest expense is interest expense related to the Card Member lending, Card Member charge card and other activities in the Consolidated Statements of Income. Interest expense does not include interest on liabilities recorded under GAAP governing accounting for uncertainty in income taxes. The Company’s policy is to classify such interest in income tax provision in the Consolidated Statements of Income.
(b)
For purposes of the “earnings” computation, “other adjustments” include adding the amortization of capitalized interest, the distributed net income of affiliates accounted for under the equity method, the non-controlling interest in the earnings of majority-owned subsidiaries with fixed charges, and the interest component of rental expense, and subtracting undistributed net income of affiliates accounted for under the equity method.
(c)
For purposes of the “fixed charges” computation, “other adjustments” include capitalized interest costs and the interest component of rental expense.
(d)
Preferred stock dividends represent pre-tax earnings that would be required to cover any preferred stock dividends, computed using our effective tax rate for the period.