Exhibit 12
Arch Capital Group Ltd. and Subsidiaries | |||||||||||||||||||
Computation of Ratio of Earnings to Fixed Charges and Preference Dividends | |||||||||||||||||||
(in thousands, except ratios) | |||||||||||||||||||
Years Ended December 31, | |||||||||||||||||||
2014 | 2013 | 2012 | 2011 | 2010 | |||||||||||||||
Income before income taxes | $ | 844,247 | $ | 742,505 | $ | 589,387 | $ | 426,370 | $ | 850,401 | |||||||||
Equity in net income or loss of investees | (947 | ) | 52,238 | (43,632 | ) | 71,100 | (56,035 | ) | |||||||||||
Fixed charges | 53,319 | 33,304 | 34,223 | 37,166 | 35,018 | ||||||||||||||
Income available for fixed charges | $ | 896,619 | $ | 828,047 | $ | 579,978 | $ | 534,636 | $ | 829,384 | |||||||||
Fixed charges: | |||||||||||||||||||
Interest and amortization on indebtedness | 45,634 | 27,060 | 28,525 | 31,691 | 30,007 | ||||||||||||||
Estimate of interest component within rental expense, net of sublease income (1) | 7,685 | 6,244 | 5,698 | 5,475 | 5,011 | ||||||||||||||
Total fixed charges | 53,319 | 33,304 | 34,223 | 37,166 | 35,018 | ||||||||||||||
Preference dividends (2) | 36,675 | 21,938 | 25,079 | 25,844 | 25,844 | ||||||||||||||
Total fixed charges and preference dividends | $ | 89,994 | $ | 55,242 | $ | 59,302 | $ | 63,010 | $ | 60,862 | |||||||||
Ratio of earnings to fixed charges | 16.8 | 24.9 | 16.9 | 14.4 | 23.7 | ||||||||||||||
Ratio of earnings to fixed charges and preference dividends | 10.0 | 15.0 | 9.8 | 8.5 | 13.6 |
(1) | Represents a reasonable approximation of the interest cost component of rental expense, net of sublease income, incurred by the Company. |
(2) | Includes dividends attributable to redeemable noncontrolling interests. |