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EXHIBIT 12
HOUSEHOLD FINANCE CORPORATION AND SUBSIDIARIES
COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES AND
TO COMBINED FIXED CHARGES AND PREFERRED STOCK DIVIDENDS
<TABLE>
<CAPTION>
Six Months
Ended
June, 30 Year Ended December 31,
--------------------- ---------------------------------------------------------
2000 1999 1999 1998 1997 1996 1995
-------- -------- -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C> <C> <C>
Net income $ 495.5 $ 446.0 $1,019.9 $ 304.9 $ 767.1 $ 650.0 $ 412.3
Income taxes 259.4 239.0 550.8 361.8 391.9 358.1 295.3
-------- -------- -------- -------- -------- -------- --------
Income before income taxes 754.9 685.0 1,570.7 666.7 1,159.0 1,008.1 707.6
Fixed charges:
Interest expense (1) 1,284.2 1,034.6 2,158.3 2,009.3 1,863.0 1,727.9 1,675.9
Interest portion of
rentals (2) 21.6 18.3 37.7 48.1 46.8 45.2 37.1
-------- -------- -------- -------- -------- -------- --------
Total fixed charges 1,305.8 1,052.9 2,196.0 2.057.4 1,909.8 1,773.1 1,713.0
Total earnings as defined $2,060.7 $1,737.9 $3,766.7 $2,724.1 $3,068.8 $2,781.2 $2,420.6
======== ========= ======== ======== ========= ======== ========
Ratio of earnings to fixed
charges (3) 1.58 1.65 1.72 1.32 1.61 1.57 1.41
======= ======== ======= ======= ======== ======= =======
Preferred stock dividends (4) -- -- -- -- $ 14.6 $ 19.4 $ 21.3
======== ======== ======== ======== ======== ======== ========
Ratio of earnings to combined
fixed charges and preferred
stock dividends (3) 1.58 1.65 1.72 1.32 1.59 1.55 1.40
======== ======== ======== ======== ======== ======== ========
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(1) For financial statement purposes, these amounts are reduced for income
earned on temporary investment of excess funds, generally resulting from
over-subscriptions of commercial paper issuances.
(2) Represents one-third of rentals, which approximates the portion
representing interest.
(3) The 1998 ratios have been negatively impacted by the one-time merger and
integration related costs associated with our merger with Beneficial
Corporation ("Beneficial"). Excluding the Beneficial merger and integration
costs of $751.0 million after-tax, our ratio of earnings to fixed charges
and our ratio of earnings to combined fixed charges and preferred stock
dividends in 1998 was 1.81.
(4) Preferred stock dividends are grossed up to their pre-tax equivalents.
