Earnings per Common Share

3 Months Ended

Mar. 31, 2017

(9) Earnings per Common Share

Basic earnings per common share are computed as net income available to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted earnings per common share include the dilutive effect, if any, of additional potential common shares issuable under the equity incentive plan, computed using the treasury stock method, and the impact of the Company’s convertible preferred stock using the “if converted” method.


	Three months ended
	March 31,
	2017		2016
Basic
Net income	$	4,635	$	4,725
Preferred stock dividends		319		391

Net income available to common shareholders - basic	$	4,316	$	4,334

Weighted average common shares outstanding - basic		9,100,330		7,845,768

Basic earnings per common share	$	0.47	$	0.55

Diluted
Net income available to common shareholders - basic	$	4,316	$	4,334
Preferred stock dividends		319		391

Net income available to common shareholders - diluted	$	4,635	$	4,725

Weighted average common shares outstanding for basic earnings per common share basic		9,100,330		7,845,768
Add: Dilutive effects of convertible preferred shares		2,508,003		3,078,245

Average shares and dilutive potential common shares outstanding - diluted		11,608,333		10,924,013

Diluted earnings per common share	$	0.40	$	0.43

For the quarters ended March 31, 2017 and March 31, 2016, there were 2,508,003 and 3,078,245, respectively, of average dilutive shares related to the Company’s convertible preferred stock. Under the “if converted” method, all convertible preferred shares are assumed to be converted into common shares at the corresponding conversion rate. These additional shares are then added to the common shares outstanding to calculate diluted earnings per share.