Exhibit 12
Principal Financial Group, Inc.
Computation of Earnings to Fixed Charges Ratio
The ratio of earnings to fixed charges is a measure of our ability to cover fixed costs with current period earnings. A high ratio indicates that earnings are sufficiently covering committed expenses. The following table sets forth, for the years indicated, our ratios of:
· earnings to fixed charges before interest credited on investment products and
· earnings to fixed charges.
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| For the years ended December 31, |
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| 2011 |
| 2010 |
| 2009 |
| 2008 |
| 2007 |
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| ($ in millions) |
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1. |
| Income from continuing operations before income taxes |
| $ | 987.6 |
| $ | 841.3 |
| $ | 745.8 |
| $ | 461.3 |
| $ | 1,072.4 |
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2. |
| Interest expense |
| 140.5 |
| 122.9 |
| 118.0 |
| 110.3 |
| 115.3 |
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3. |
| Interest factor of rental expense |
| 6.1 |
| 6.4 |
| 6.7 |
| 8.8 |
| 12.3 |
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4. |
| Undistributed income from equity investees |
| (99.1 | ) | (84.0 | ) | (69.4 | ) | (20.4 | ) | (71.6 | ) | |||||
5. |
| Earnings before interest credited on investment products |
| 1,035.1 |
| 886.6 |
| 801.1 |
| 560.0 |
| 1,128.4 |
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6. |
| Interest credited on investment products |
| 442.4 |
| 579.2 |
| 725.3 |
| 993.5 |
| 988.3 |
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7. |
| Earnings |
| $ | 1,477.5 |
| $ | 1,465.8 |
| $ | 1,526.4 |
| $ | 1,553.5 |
| $ | 2,116.7 |
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8. |
| Interest expense |
| $ | 140.5 |
| $ | 122.9 |
| $ | 118.0 |
| $ | 110.3 |
| $ | 115.3 |
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9. |
| Interest factor of rental expense |
| 6.1 |
| 6.4 |
| 6.7 |
| 8.8 |
| 12.3 |
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10. |
| Preferred stock dividends by registrant |
| 33.0 |
| 33.0 |
| 33.0 |
| 33.0 |
| 33.0 |
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11. |
| Fixed charges before interest credited on investment products |
| 179.6 |
| 162.3 |
| 157.7 |
| 152.1 |
| 160.6 |
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12. |
| Interest credited on investment products |
| 442.4 |
| 579.2 |
| 725.3 |
| 993.5 |
| 988.3 |
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13. |
| Fixed charges |
| $ | 622.0 |
| $ | 741.5 |
| $ | 883.0 |
| $ | 1,145.6 |
| $ | 1,148.9 |
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14. |
| Ratio of earnings to fixed charges before interest credited on investment products (Line item 5/Line item 11) |
| 5.8 |
| 5.5 |
| 5.1 |
| 3.7 |
| 7.0 |
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15. |
| Ratio of earnings to fixed charges (Line item 7/Line item 13) |
| 2.4 |
| 2.0 |
| 1.7 |
| 1.4 |
| 1.8 |
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