EX-12.1 2 dfsex1216302017.htm STATEMENT RE: COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND COMPUTATION Exhibit


Exhibit 12.1
DISCOVER FINANCIAL SERVICES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
(dollars in millions)
 
For the Six Months Ended June 30,
 
For the Calendar Years Ended December 31,
 
For the Fiscal Year Ended November 30, 2012
 
For the One Month Ended December 31, 2012
 
2017
 
2016
 
2016
 
2015
 
2014
 
2013
 
 
Earnings:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income before income tax expense
$
1,735

 
$
1,812

 
$
3,656

 
$
3,612

 
$
3,694

 
$
3,944

 
$
3,753

 
$
274

Losses from unconsolidated investees
27

 
26

 
58

 
50

 
29

 
18

 
12

 
1

Total earnings
$
1,762

 
$
1,838

 
$
3,714

 
$
3,662

 
$
3,723

 
$
3,962

 
$
3,765

 
$
275

Fixed charges:(1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total interest expense
$
786

 
$
673

 
$
1,398

 
$
1,263

 
$
1,134

 
$
1,146

 
$
1,331

 
$
103

Interest factor in rents
2

 
3

 
5

 
6

 
5

 
5

 
6

 
1

Total fixed charges
$
788

 
$
676

 
$
1,403

 
$
1,269

 
$
1,139

 
$
1,151

 
$
1,337

 
$
104

Combined fixed charges and preferred stock dividends:(1)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total interest expense
$
786

 
$
673

 
$
1,398

 
$
1,263

 
$
1,134

 
$
1,146

 
$
1,331

 
$
103

Interest factor in rents
2

 
3

 
5

 
6

 
5

 
5

 
6

 
1

Preferred stock dividends
30

 
28

 
57

 
59

 
60

 
60

 
—

 
—

Total combined fixed charges and preferred stock dividends
$
818

 
$
704

 
$
1,460

 
$
1,328

 
$
1,199

 
$
1,211

 
$
1,337

 
$
104

Earnings before income tax expense and fixed charges
$
2,550

 
$
2,514

 
$
5,117

 
$
4,931

 
$
4,862

 
$
5,113

 
$
5,102

 
$
379

Earnings before income tax expense and combined fixed charges and preferred stock dividends
$
2,580

 
$
2,542

 
$
5,174

 
$
4,990

 
$
4,922

 
$
5,173

 
$
5,102

 
$
379

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Ratio of earnings to fixed charges
3.2

 
3.7

 
3.6

 
3.9

 
4.3

 
4.4

 
3.8

 
3.6

Ratio of earnings to combined fixed charges and preferred stock dividends
3.2

 
3.6

 
3.5

 
3.8

 
4.1

 
4.3

 
3.8

 
3.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1)
Fixed charges are the sum of interest expensed, amortized premiums, discounts and capitalized expenses related to indebtedness, an estimate of interest within rental expense. Combined fixed charges and preferred stock requirements are the sum of interest expense, amortized premiums, discounts and capitalized expenses related to indebtedness, an estimate of interest within rental expense and preference security dividend requirements.