EX-12 2 w26840exv12.htm COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES exv12
 

Exhibit 12
ADVANTA CORP. AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES
                                 
    Three Months Ended   Nine Months Ended
($ in thousands)   September 30,   September 30,
    2006   2005   2006   2005
 
Income from continuing operations
   $ 21,120     $ 16,155     $ 66,070     $ 103,207  
Income tax expense
     13,222       10,329       41,361       31,871  
 
Earnings before income taxes (1)
     34,342       26,484       107,431       135,078  
Fixed charges:
                                
Interest on debt, deposits and other borrowings
     17,360       13,012       46,215       34,736  
Interest on subordinated debt payable to preferred securities trust
     2,289       2,289       6,868       6,868  
One-third of all rentals
     463       411       1,367       1,212  
 
Total fixed charges
     20,112       15,712       54,450       42,816  
 
Earnings before income taxes and fixed charges
   $ 54,454     $ 42,196     $ 161,881     $ 177,894  
Ratio of earnings to fixed charges (2)
     2.71 x      2.69 x      2.97 x      4.15 x 
 
 
(1)   Earnings before income taxes in the nine months ended September 30, 2005 includes a $67.7 million gain on transfer of consumer credit card business relating to our May 28, 2004 agreement with Bank of America Corp.
 
(2)   For purposes of computing these ratios, “earnings” represent income before income taxes plus fixed charges. “Fixed charges” consist of interest expense and one-third (the portion deemed representative of the interest factor) of rental expense on operating leases.