EXHIBIT 12.1
THE CHARLES SCHWAB CORPORATION
Computation of Ratio of Earnings to Fixed Charges
(Dollar amounts in thousands, unaudited)
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Year Ended December 31,
2000 1999 1998 1997 1996
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Earnings before taxes on income $1,231,473 $1,098,915 $ 677,638 $ 530,906 $ 463,336
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Fixed charges
Interest expense:
Brokerage clients cash balances 1,076,446 700,601 579,994 481,187 368,462
Deposits from banking clients 155,073 117,489 107,846 99,622 82,547
Long-term debt 54,639 32,712 30,155 25,305 20,317
Stock-lending activities 40,444 31,555 37,382 37,406 25,315
Short-term borrowings 20,458 8,660 9,320 16,318 11,811
Other 4,716 7,202 9,301 7,507 13,281
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Total 1,351,776 898,219 773,998 667,345 521,733
Interest portion of rental expense 74,982 53,731 41,257 36,180 31,629
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Total fixed charges (A) 1,426,758 951,950 815,255 703,525 553,362
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Earnings before taxes on income and fixed charges (B) $2,658,231 $2,050,865 $1,492,893 $1,234,431 $1,016,698
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Ratio of earnings to fixed charges (B) / (A)* 1.9 2.2 1.8 1.8 1.8
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Ratio of earnings to fixed charges
excluding brokerage client interest expense** 4.5 5.4 3.9 3.4 3.5
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All periods have been restated to reflect the merger of The Charles Schwab Corporation with U.S. Trust Corporation.
* The ratio of earnings to fixed charges is calculated in accordance with SEC requirements. For such purposes,
"earnings" consist of earnings before taxes on income and fixed charges. "Fixed charges" consist of interest
expense as listed above, including one-third of rental expense, which is estimated to be representative of the
interest factor.
** Because interest expense incurred in connection with payables to brokerage clients is completely offset by interest
revenue on related investments and margin loans, the Company considers such interest to be an operating expense.
Accordingly, the ratio of earnings to fixed charges excluding brokerage client interest expense reflects the
elimination of such interest expense as a fixed charge.