EX-12.2 7 a05-14303_1ex12d2.htm EX-12.2

Exhibit 12.2

 

HSBC USA Inc.

Computation of Ratio of Earnings to Combined Fixed Charges

and Preferred Dividends

(in  millions,  except  ratios)

 

 

 

Six Months
Ended
June 30,

 

Year Ended December 31,

 

 

 

2005

 

2004

 

2004

 

2003

 

2002

 

2001

 

2000

 

Excluding interest on deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Income before cumulative effect of accounting change

 

$

529

 

$

650

 

$

1,258

 

$

941

 

$

855

 

$

354

 

$

569

 

Income tax expense

 

307

 

337

 

718

 

570

 

510

 

226

 

339

 

Less undistributed equity earnings

 

22

 

19

 

21

 

6

 

7

 

9

 

8

 

Fixed charges :

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Interest on :

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Borrowed funds

 

119

 

52

 

132

 

91

 

232

 

337

 

445

 

Long-term debt

 

461

 

114

 

380

 

206

 

225

 

281

 

420

 

One third of rents, net of income from subleases

 

8

 

8

 

19

 

17

 

17

 

18

 

22

 

Total fixed charges

 

588

 

174

 

531

 

314

 

474

 

636

 

887

 

Earnings before taxes and cumulative effect of accounting change based on income and fixed charges

 

$

1,402

 

$

1,142

 

$

2,486

 

$

1,819

 

$

1,832

 

$

1,207

 

$

1,787

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total fixed charges (as above)

 

$

588

 

$

174

 

$

531

 

$

314

 

$

474

 

$

636

 

$

887

 

Preferred dividends

 

12

 

11

 

23

 

22

 

23

 

25

 

28

 

Ratio of pretax income to income before cumulative effect of accounting change

 

1.58

 

1.52

 

1.57

 

1.61

 

1.60

 

1.64

 

1.60

 

Total preferred stock dividend factor

 

19

 

17

 

36

 

36

 

37

 

41

 

44

 

Fixed charges, including preferred stock dividend factor

 

$

607

 

$

191

 

$

567

 

$

350

 

$

511

 

$

677

 

$

931

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to combined fixed charges and preferred dividends

 

2.31

 

5.98

 

4.38

 

5.20

 

3.59

 

1.78

 

1.92

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Including interest on deposits

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Total fixed charges, including preferred stock dividend factor (as above)

 

$

607

 

$

191

 

$

567

 

$

350

 

$

511

 

$

677

 

$

931

 

Add: Interest on deposits

 

723

 

318

 

825

 

666

 

974

 

1,904

 

2,334

 

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

 

$

1,330

 

$

509

 

$

1,392

 

$

1,016

 

$

1,485

 

$

2,581

 

$

3,265

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Earnings before taxes and cumulative effect of accounting change based on income and fixed charges (as above)

 

$

1,402

 

$

1,142

 

$

2,486

 

$

1,819

 

$

1,832

 

$

1,207

 

$

1,787

 

Add: Interest on deposits

 

723

 

318

 

825

 

666

 

974

 

1,904

 

2,334

 

Total

 

$

2,125

 

$

1,460

 

$

3,311

 

$

2,485

 

$

2,806

 

$

3,111

 

$

4,121

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ratio of earnings to combined fixed charges and preferred dividends

 

1.60

 

2.87

 

2.38

 

2.45

 

1.89

 

1.21

 

1.26