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THE CHARLES SCHWAB CORPORATION
Computation of Ratio of Earnings to Fixed Charges
(Dollar amounts in thousands)
(Unaudited)
Three Months Ended Six Months Ended
June 30, June 30,
2000 1999 2000 1999
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<S> <C> <C> <C> <C>
Earnings before taxes on income $253,537 $281,879 $ 765,092 $548,294
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Fixed charges
Interest expense:
Brokerage clients cash balances 262,816 160,576 504,446 316,728
Deposits from banking clients 37,850 26,971 73,039 53,731
Long-term debt 14,591 7,863 24,834 15,123
Stock-lending activities 10,825 7,027 24,460 15,690
Short-term borrowings 4,764 2,125 7,141 4,367
Other 1,342 1,668 2,655 3,709
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Total 332,188 206,230 636,575 409,348
Interest portion of rental expense 17,606 11,787 33,804 23,451
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Total fixed charges (A) 349,794 218,017 670,379 432,799
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Earnings before taxes on income and fixed charges (B) $603,331 $499,896 $1,435,471 $981,093
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Ratio of earnings to fixed charges (B) divided by (A)* 1.7 2.3 2.1 2.3
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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.
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