E Trade Financial (ETFC) 10-K 2004 FY Annual report

Exhibit 12.1

STATEMENT OF COMPUTATION OF RATIO EARNINGS TO FIXED CHARGES

(in thousands, except ratio of earnings to fixed charges)

	For the Year Ended December 31,
	2004		2003		2002		2001			2000
Fixed charges:
Interest expense	$	557,978	$	531,698	$	608,914	$	832,137		$	630,397
Amortization of debt issue expense		2,083		3,084		3,217		3,432			1,788
Estimated interest portion within rental expense		7,236		11,288		10,501		15,912			14,202
Preference securities dividend requirements of consol. subs		—		—		—		—			—
Total fixed charges	$	567,297	$	546,070	$	622,632	$	851,481		$	646,387
Earnings:
Income (loss) before income taxes, discontinued operations and cumulative effect of accounting change less equity in income (loss) of investments	$	503,736	$	295,520	$	184,869	$	(254,763	)	$	115,962
Fixed charges		567,297		546,070		622,632		851,481			646,387
Less:
Preference securities dividend requirement of consol subs		—		—		—		—			—
Earnings	$	1,071,033	$	841,590	$	807,501	$	596,718		$	762,349
Ratio of earnings to fixed charges	$	1.89	$	1.54	$	1.30	$	0.70		$	1.18
Excess (deficiency) of earnings to fixed charges	$	503,736	$	295,520	$	184,869	$	(254,763	)	$	115,962

The ratio of earnings to fixed charges is computed by dividing fixed charges into income (loss) before income taxes, discontinued operations and the cumulative effect of accounting changes less equity in the income (loss) of investments plus fixed charges less the preference securities dividend requirement of consolidated subsidiaries. Fixed charges include, as applicable, interest expense, amortization of debt issuance costs, the estimated interest component of rent expense and the preference securities dividend requirement of consolidated subsidiaries.