EX-12.02 4 d62698_ex12-02.txt COMPUTATION OF RATIO OF EARNINGS Exhibit 12.02 HSBC USA Inc. Computation of Ratio of Earnings to Combined Fixed Charges and Preferred Dividends (in millions, except ratios)
----------------------------------------------------------------------------------------------------------------------------- Year Ended December 31 2004 2003 2002 2001 2000 ----------------------------------------------------------------------------------------------------------------------------- Excluding interest on deposits: Income before cumulative effect of accounting change . $1,258 $ 941 $ 855 $ 354 $ 569 Applicable income tax expense ........................ 718 570 510 226 339 Less undistributed equity earnings ................... 21 6 7 9 8 Fixed charges: Interest on: Borrowed funds ............................. 132 91 232 337 445 Long-term debt ............................. 380 206 225 281 420 One third of rents, net of income from subleases 19 17 17 18 22 ------ ------ ------ ------ ------ Total fixed charges .................................. 531 314 474 636 887 Earnings before taxes and cumulative effect of accounting change based on income and fixed charges $2,486 $1,819 $1,832 $1,207 $1,787 ====== ====== ====== ====== ====== Total fixed charges (as above) ....................... $ 531 $ 314 $ 474 $ 636 $ 887 Preferred dividends .................................. 23 22 23 25 28 Ratio of pretax income to income before cumulative effect of accounting change ........................ 1.57 1.61 1.60 1.64 1.60 ------ ------ ------ ------ ------ Total preferred stock dividend factor ................ 36 36 37 41 44 Fixed charges, including preferred stock dividend factor $ 567 $ 350 $ 511 $ 677 $ 931 ====== ====== ====== ====== ====== Ratio of earnings to combined fixed charges and preferred dividends ................................ 4.38 5.20 3.59 1.78 1.92 ====== ====== ====== ====== ====== Including interest on deposits: Fixed charges, including preferred stock dividend factor (as above) .................................. $ 567 $ 350 $ 511 $ 677 $ 931 Add: Interest on deposits ............................ 825 666 974 1,904 2,334 ------ ------ ------ ------ ------ Total fixed charges, including preferred stock dividend factor and interest on deposits ........... $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) ................................. $2,486 $1,819 $1,832 $1,207 $1,787 Add: Interest on deposits ............................ 825 666 974 1,904 2,334 ------ ------ ------ ------ ------ Total ................................................ $3,311 $2,485 $2,806 $3,111 $4,121 ====== ====== ====== ====== ====== Ratio of earnings to combined fixed charges and preferred dividends ................................ 2.38 2.45 1.89 1.21 1.26 ====== ====== ====== ====== ======
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