EX-12 6 w99681exv12.txt CONSOLIDATED COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES . . . EXHIBIT 12 ADVANTA CORP. AND SUBSIDIARIES CONSOLIDATED COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
THREE MONTHS ENDED SIX MONTHS ENDED ($ IN THOUSANDS) JUNE 30, JUNE 30, ---------------------------------------------------------------------------------------------------------------- 2004 2003 2004 2003 ---------------------------------------------------------------------------------------------------------------- Income from continuing operations $10,832 $ 6,281 $20,271 $12,186 Income tax expense 7,071 3,932 13,234 7,628 ---------------------------------------------------------------------------------------------------------------- Earnings before income taxes 17,903 10,213 33,505 19,814 Fixed charges: Interest on debt, deposits and other borrowings 8,556 13,111 17,798 24,382 Interest on subordinated debt payable to preferred securities trust(2) 2,290 0 4,579 0 One-third of all rentals 408 664 1,042 1,304 Preferred stock dividend of subsidiary trust(2) 0 2,248 0 4,495 ---------------------------------------------------------------------------------------------------------------- Total fixed charges 11,254 16,023 23,419 30,181 ---------------------------------------------------------------------------------------------------------------- Earnings before income taxes and fixed charges $29,157 $26,236 $56,924 $49,995 Ratio of earnings to fixed charges(1) 2.59 x 1.64 x 2.43 x 1.66 x
(1) For purposes of computing these ratios, "earnings" represent income before income taxes plus fixed charges. "Fixed charges" consist of interest expense, one-third (the portion deemed representative of the interest factor) of rental expense on operating leases, and preferred stock dividends of subsidiary trust. (2) Our adoption of FIN 46, as revised, resulted in the deconsolidation of the subsidiary trust that issued our trust preferred securities effective December 31, 2003. As a result of the deconsolidation of that trust, the consolidated income statement includes interest expense on subordinated debt payable to preferred securities trust beginning January 1, 2004, as compared to periods through December 31, 2003 that included payments on the trust preferred securities classified as minority interest in income of consolidated subsidiary.