KKR Financial 8-K Material Modifications to Rights of Security Holders

Exhibit 12.1

Computation of Ratios of Earnings to Combined Fixed Charges and Preferred Equity Distributions

(amounts in thousands)

	Nine Months ended September 30, 2012		Year ended December 31, 2011		Nine Months ended September 30, 2011		Year ended December 31, 2010		Year ended December 31, 2009		Year ended December 31, 2008			Year ended December 31, 2007		Year ended December 31, 2006 (1)
Earnings (loss):
Income (loss) before equity in income of unconsolidated affiliate and income tax expense	$	267,669	$	326,083	$	249,435	$	371,766	$	77,220	$	(1,077,601	)	$	205,000	120,868
Add: Fixed charges from below	161,919		183,067		136,629		156,852		289,374		564,614			617,504		430,384
Total earnings (loss) before equity in income of unconsolidated affiliate, income tax expense, and fixed charges	$	429,588	$	509,150	$	386,064	$	528,618	$	366,594	$	(512,987	)	$	822,504	551,252
Fixed charges:
Interest expenses	$	161,919	$	183,067	$	136,629	$	156,852	$	289,374	$	564,614		$	617,504	430,384
Total fixed charges	$	161,919	$	183,067	$	136,629	$	156,852	$	289,374	$	564,614		$	617,504	430,384
Ratio of earnings (loss) to fixed charges	2.7		2.8		2.8		3.4		1.3		*			1.3		1.3

* Losses exceeded fixed charges by approximately $513.0 million for the year ended December 31, 2008. The coverage deficiency for total fixed charges for the year ended December 31, 2008 was $1,077.6 million to arrive at a one-to-one ratio.