EX-12 6 dex12.htm HISTORICAL RATIO OF EARNINGS TO FIXED CHARGES Historical Ratio of Earnings to Fixed Charges

LINCOLN NATIONAL CORPORATION AND SUBSIDIARIES

 

EXHIBIT 12—RATIO OF EARNINGS TO FIXED CHARGES

 

     Three Months Ended
March 31,

(dollars in millions)        

    2005
    2004

Income before Federal Income Taxes and Cumulative Effect of Accounting Changes

    $ 237.8    $ 208.6

Sub-total of Fixed Charges

      27.9      28.4
    
  

Sub-total of Adjusted Net Income

      265.7      237.0

Interest on Annuities & Financial Products

      389.5      390.4
    
  

Adjusted Income Base

      655.2      627.4
    
  

Fixed Charges:

              

Interest and Debt Expense

      22.4      22.8

Portion of Rent Expense Representing Interest

      5.5      5.6
    
  

Sub-total of Fixed Charges

      27.9      28.4

Interest on Annuities & Financial Products

      389.5      390.4
    
  

Sub-total of Fixed Charges

      417.4      418.8

Preferred Dividends (Pre-tax)

      *      *
    
  

Total Fixed Charges

    $ 417.4    $ 418.8
    
  

*  Less than $100,000

              

Ratio of Earnings to Fixed Charges:

              

Ratio of Earnings to Fixed Charges (Including Interest on Annuities and Financial Products) (1)

      1.57      1.50

Excluding Interest on Annuities and Financial Products (2)

      9.52      8.34

Ratio of Earnings to Combined Fixed Charges and Preferred Stock Dividends (3)

      1.57      1.50
1. For purposes of determining this ratio, earnings consist of income before Federal income taxes, cumulative effect of accounting change, if any, and minority interests adjusted for the difference between income or losses from unconsolidated equity investments and cash distributions from such investments, plus fixed charges. Fixed charges consist of 1) interest and debt expense on short and long-term debt and junior subordinated debentures issued to affiliated trusts; 2) interest on annuities and financial products and; 3) the portion of operating leases that are representative of the interest factor.
2. Same as the ratio of earnings to fixed charges, except fixed charges and earnings in this calculation do not include interest on annuities and financial products. This coverage ratio is not required, but is provided as additional information. This ratio is commonly used by individuals who analyze LNC’s results.
3. Same as the ratio of earnings to fixed charges, including interest on annuities and financial products, except that fixed charges include the pre-tax earnings required to cover preferred stock dividend requirements.