(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				Six months ended
	June 30,				June 30,
	2017		2016		2017		2016
Basic
Net income	$	3,596	$	5,181	$	8,231	$	9,906
Preferred stock dividends		308		391		627		782

Net income available to common shareholders—basic	$	3,288	$	4,790	$	7,604	$	9,124

Weighted average common shares outstanding—basic		10,162,528		7,877,119		9,634,363		7,861,444

Basic earnings per common share	$	0.32	$	0.61	$	0.79	$	1.16

Diluted
Net income available to common shareholders—basic	$	3,288	$	4,790	$	7,604	$	9,124
Preferred stock dividends		308		391		627		782

Net income available to common shareholders—diluted	$	3,596	$	5,181	$	8,231	$	9,906

Weighted average common shares outstanding for basic earnings per common share		10,162,528		7,877,119		9,634,363		7,861,444
Add: Dilutive effects of convertible preferred shares		2,431,349		3,074,402		2,469,465		3,076,323

Average shares and dilutive potential common shares outstanding—diluted		12,593,877		10,951,521		12,103,828		10,937,767

Diluted earnings per common share	$	0.29	$	0.47	$	0.68	$	0.91

For the three-month period ended June 30, 2017 there were 2,431,349 dilutive shares related to the Company’s convertible preferred stock. For the six-month period ended June 30, 2017 there were 2,469,465 dilutive shares related to the Company’s convertible preferred stock. For the three-month period ended June 30, 2016 there were 3,074,402 dilutive shares related to the Company’s convertible preferred stock. For the six-month period ended June 30, 2016 there were 3,076,323 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.