EX-12 2 d06-68822_ex12.htm STATEMENT RE: COMPUTATION OF RATIOS

Exhibit 12

HSBC USA Inc.
Computation of Ratio of Earnings to Fixed Charges and
Earnings to Combined Fixed Charges and Preferred Stock Dividends
(in millions, except ratios)

 

 

 

 

 

 

 

 

 

 

Six Months Ended June 30

 

 

 

2006

 

2005

 

Ratios excluding interest on deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

594

 

$

529

 

Income tax expense

 

 

308

 

 

307

 

Less: Undistributed equity earnings

 

 

25

 

 

22

 

Fixed charges:

 

 

 

 

 

 

 

Interest on:

 

 

 

 

 

 

 

Borrowed funds

 

 

149

 

 

119

 

Long-term debt

 

 

694

 

 

461

 

One third of rents, net of income from subleases

 

 

12

 

 

8

 

 

 

 

 

Total fixed charges, excluding interest on deposits

 

 

855

 

 

588

 

 

 

 

 

 

 

 

 

Earnings before taxes and fixed charges, net of undistributed equity earnings

 

$

1,732

 

$

1,402

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to fixed charges

 

 

2.03

 

 

2.38

 

 

 

 

 

 

 

 

 

 

 

 

 

Total preferred stock dividend factor (1)

 

$

57

 

$

27

 

 

 

 

 

Fixed charges, including the preferred stock dividend factor

 

$

912

 

$

615

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to combined fixed charges and preferred stock dividends

 

 

1.90

 

 

2.28

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratios including interest on deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total fixed charges, excluding interest on deposits

 

$

855

 

$

588

 

Add: Interest on deposits

 

 

1,419

 

 

723

 

 

 

 

 

Total fixed charges, including interest on deposits

 

$

2,274

 

$

1,311

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings before taxes and fixed charges, net of undistributed equity earnings

 

$

1,732

 

$

1,402

 

Add: Interest on deposits

 

 

1,419

 

 

723

 

 

 

 

 

Total

 

$

3,151

 

$

2,125

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to fixed charges

 

 

1.39

 

 

1.62

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed charges, including the preferred stock dividend factor

 

$

912

 

$

615

 

Add: Interest on deposits

 

 

1,419

 

 

723

 

 

 

 

 

Fixed charges, including the preferred stock dividend factor and interest on deposits

 

$

2,331

 

$

1,338

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to combined fixed charges and preferred stock dividends

 

 

1.35

 

 

1.59

 

 

 

 

 

(1)      Preferred stock dividends grossed up to their pretax equivalents.

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