EX-12 2 a2172301zex-12.txt EXHIBIT 12 EXHIBIT 12 AMERICAN EXPRESS COMPANY COMPUTATION IN SUPPORT OF RATIO OF EARNINGS TO FIXED CHARGES (Dollars in Millions)
Six Months Years Ended December 31, Ended June 30, ------------------------------------------------- 2006 2005 2004 2003 2002 -------------- ---------- ---------- ---------- ---------- Earnings: Pretax income from continuing operations $ 1,848 $ 4,248 $ 3,831 $ 3,415 $ 3,021 Interest expense 1,297 2,168 1,659 1,606 1,832 Other adjustments 70 150 151 154 174 -------------- ---------- ---------- ---------- ---------- Total earnings (a) $ 3,215 $ 6,566 $ 5,641 $ 5,175 $ 5,027 -------------- ---------- ---------- ---------- ---------- Fixed charges: Interest expense $ 1,297 $ 2,168 $ 1,659 $ 1,606 $ 1,832 Other adjustments 54 151 145 139 151 -------------- ---------- ---------- ---------- ---------- Total fixed charges (b) $ 1,351 $ 2,319 $ 1,804 $ 1,745 $ 1,983 -------------- ---------- ---------- ---------- ---------- Ratio of earnings to fixed charges (a/b) 2.38 2.83 3.13 2.97 2.54
Included in interest expense in the above computation is interest expense related to the international banking operations and the cardmember lending activities, which is netted against net investment income and cardmember lending net finance charge revenue, respectively, in the Consolidated Statements of Income. For purposes of the "earnings" computation, other adjustments include adding the amortization of capitalized interest, the net loss of affiliates accounted for under the equity method whose debt is not guaranteed by the Company, the minority 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. For purposes of the "fixed charges" computation, other adjustments include capitalized interest costs and the interest component of rental expense.