Wells Fargo & Company (WFC) 10-Q 2009 Q3 Quarterly report

EXHIBIT 12(b)
WELLS FARGO & COMPANY AND SUBSIDIARIES
COMPUTATION OF RATIOS OF EARNINGS TO FIXED CHARGES
AND PREFERRED DIVIDENDS

	Quarter					Nine months
	ended September 30				,	ended September 30				,
(in millions)	2009		2008			2009		2008
Earnings including interest on deposits(1):
Income before income tax expense	$	4,671		2,381			14,036		8,077
Less: Net income from noncontrolling interests		81		14			202		50
Income before income tax expense and noncontrolling interests		4,590		2,367			13,834		8,027
Fixed charges		2,410		2,451			8,142		7,929
		7,000		4,818			21,976		15,956
Preferred dividend requirement		598		—			1,856		—
Tax factor (based on effective tax rate)		1.42		1.45			1.46		1.49
Preferred dividends (2)		849		—			2,710		—
Fixed charges (1):
Interest expense		2,284		2,393			7,758		7,751
Estimated interest component of net rental expense		126		58			384		178
		2,410		2,451			8,142		7,929
Fixed charges and preferred dividends		3,259		2,451			10,852		7,929
Ratio of earnings to fixed charges and preferred dividends (3)		2.15		1.97			2.03		2.01
Earnings excluding interest on deposits:
Income before income tax expense and noncontrolling interests		4,590		2,367			13,834		8,027
Fixed charges		1,505		1,432			5,281		4,253
		6,095		3,799			19,115		12,280
Preferred dividends (2)		849		—			2,710		—
Fixed charges:
Interest expense		2,284		2,393			7,758		7,751
Less: Interest on deposits		905		1,019			2,861		3,676
Estimated interest component of net rental expense		126		58			384		178
		1,505		1,432			5,281		4,253
Fixed charges and preferred dividends	$	2,354		1,432			7,991		4,253
Ratio of earnings to fixed charges and preferred dividends (3)		2.59		2.65			2.39		2.89

(1)	As defined in Item 503(d) of Regulation S-K.
(2)	The preferred dividends, including accretion, were increased to amounts representing the pretax earnings that would be required to cover such dividend and accretion requirements.
(3)	These computations are included herein in compliance with Securities and Exchange Commission regulations. However, management believes that fixed charge ratios are not meaningful measures for the business of the Company because of two factors. First, even if there was no change in net income, the ratios would decline with an increase in the proportion of income which is tax-exempt or, conversely, they would increase with a decrease in the proportion of income which is tax-exempt. Second, even if there was no change in net income, the ratios would decline if interest income and interest expense increase by the same amount due to an increase in the level of interest rates or, conversely, they would increase if interest income and interest expense decrease by the same amount due to a decrease in the level of interest rates.