EX-12.02 4 d67306_ex12-02.txt COMPUTATION OF RATIO OF EARNINGS Exhibit 12.02 HSBC USA Inc. Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Dividends (in millions, except ratios)
------------------------------------------------------------------------------------------------------------------------------------ Year Ended December 31 2005 2004 2003 2002 2001 ------------------------------------------------------------------------------------------------------------------------------------ Excluding interest on deposits: Income before cumulative effect of accounting change ............................................................... $ 976 $ 1,258 $ 941 $ 855 $ 354 Applicable income tax expense .......................................... 566 718 570 510 226 Less: Undistributed equity earnings .................................... 73 21 6 7 9 Fixed charges: Interest on: Borrowed funds ................................................ 276 132 91 232 337 Long-term debt ................................................ 1,019 380 206 225 281 One third of rents, net of income from subleases ................. 19 19 17 17 18 -------- -------- -------- -------- -------- Total fixed charges .................................................... 1,314 531 314 474 636 Earnings before taxes and cumulative effect of accounting change based on income and fixed charges .................. $ 2,783 $ 2,486 $ 1,819 $ 1,832 $ 1,207 ======== ======== ======== ======== ======== Total fixed charges (as above) ......................................... $ 1,314 $ 531 $ 314 $ 474 $ 636 Preferred dividends .................................................... 46 23 22 23 25 Ratio of pretax income to income before cumulative effect of accounting change .......................................... 1.58 1.57 1.61 1.60 1.64 -------- -------- -------- -------- -------- Total preferred stock dividend factor .................................. 71 36 36 37 41 Fixed charges, including preferred stock dividend factor ............................................................... $ 1,385 $ 567 $ 350 $ 511 $ 677 ======== ======== ======== ======== ======== Ratio of earnings to combined fixed charges and preferred dividends .................................................. 2.01 4.38 5.20 3.59 1.78 ======== ======== ======== ======== ======== Including interest on deposits: Fixed charges, including preferred stock dividend factor (as above) .................................................... $ 1,385 $ 567 $ 350 $ 511 $ 677 Add: Interest on deposits .............................................. 1,771 825 666 974 1,904 -------- -------- -------- -------- -------- Total fixed charges, including preferred stock dividend factor and interest on deposits ............................. $ 3,156 $ 1,392 $ 1,016 $ 1,485 $ 2,581 ======== ======== ======== ======== ======== Earnings before taxes and cumulative effect of accounting change based on income and fixed charges (as above) ................................................... $ 2,783 $ 2,486 $ 1,819 $ 1,832 $ 1,207 Add: Interest on deposits .............................................. 1,771 825 666 974 1,904 -------- -------- -------- -------- -------- Total .................................................................. $ 4,554 $ 3,311 $ 2,485 $ 2,806 $ 3,111 ======== ======== ======== ======== ======== Ratio of earnings to combined fixed charges and preferred dividends .................................................. 1.44 2.38 2.45 1.89 1.21 ======== ======== ======== ======== ========
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