EXHIBIT 12
HSBC FINANCE CORPORATION
COMPUTATION OF RATIO OF EARNINGS (LOSS) TO FIXED CHARGES AND TO
COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
| Six Months Ended June 30, | 2012 | 2011 | ||||||
| (dollars are in millions) | ||||||||
Loss from continuing operations | $ | (2,017 | ) | $ | (393 | ) | ||
Income tax | 1,227 | 472 | ||||||
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Loss from continuing operations before income tax | (3,244 | ) | (865 | ) | ||||
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Fixed charges: | ||||||||
Interest expense | 966 | 1,265 | ||||||
Interest portion of rentals(1) | 4 | 5 | ||||||
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Total fixed charges | 970 | 1,270 | ||||||
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Total earnings (loss) from continuing operations as defined | $ | (2,274 | ) | $ | 405 | |||
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Ratio of earnings to fixed charges | (2.34 | ) | .32 | |||||
Preferred stock dividends(2) | $ | 94 | $ | 100 | ||||
Ratio of earnings (loss) to combined fixed charges and preferred stock dividends | (2.14 | ) | .30 | |||||
| (1) | Represents one-third of rentals, which approximates the portion representing interest. |
| (2) | Preferred stock dividends are grossed up to their pretax equivalents. |