EX-12 2 d72378_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

 

2007

 

2006

 

 

 

 

 

 

 

 

 

Ratios excluding interest on deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net income

 

$

564

 

$

594

 

Income tax expense

 

 

253

 

 

308

 

Less: Undistributed equity earnings

 

 

—

 

 

25

 

Fixed charges:

 

 

 

 

 

 

 

Interest on:

 

 

 

 

 

 

 

Borrowed funds

 

 

176

 

 

146

 

Long-term debt

 

 

723

 

 

697

 

One third of rents, net of income from subleases

 

 

14

 

 

12

 

 

 

 

 

Total fixed charges, excluding interest on deposits

 

 

913

 

 

855

 

 

 

 

 

 

 

 

 

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

 

$

1,730

 

$

1,732

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to fixed charges

 

 

1.89

 

 

2.03

 

 

 

 

 

 

 

 

 

 

 

 

 

Total preferred stock dividend factor (1)

 

$

72

 

$

57

 

 

 

 

 

Fixed charges, including the preferred stock dividend factor

 

$

985

 

$

912

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to combined fixed charges and preferred stock dividends

 

 

1.76

 

 

1.90

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratios including interest on deposits:

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total fixed charges, excluding interest on deposits

 

$

913

 

$

855

 

Add: Interest on deposits

 

 

1,848

 

 

1,419

 

 

 

 

 

Total fixed charges, including interest on deposits

 

$

2,761

 

$

2,274

 

 

 

 

 

 

 

 

 

 

 

 

 

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

 

$

1,730

 

$

1,732

 

Add: Interest on deposits

 

 

1,848

 

 

1,419

 

 

 

 

 

Total

 

$

3,578

 

$

3,151

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to fixed charges

 

 

1.30

 

 

1.39

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed charges, including the preferred stock dividend factor

 

$

985

 

$

912

 

Add: Interest on deposits

 

 

1,848

 

 

1,419

 

 

 

 

 

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

 

$

2,833

 

$

2,331

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to combined fixed charges and preferred stock dividends

 

 

1.26

 

 

1.35

 

 

 

 

 

 

 

(1)

Preferred stock dividends grossed up to their pretax equivalents.

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