Basic net income per common share is computed by dividing net income to common shareholders by the weighted average number of common shares outstanding during the period, without considering any dilutive items. Diluted net income per common share is computed by dividing net income to common shareholders by the weighted average number of common shares and common stock equivalents for items that are dilutive, net of shares assumed to be repurchased using the treasury stock method at the average share price for the Company’s common stock during the period. Common stock equivalents arise from the assumed conversion of outstanding stock options to purchase common stock. Shares owned by the Bank’s ESOP that have not been allocated are not considered to be outstanding for the purpose of computing basic and diluted net income per common share. At December 31, 2018 and 2017, there were 14,027 and 51,105 shares, respectively, that had not been allocated under the Bank’s ESOP.

Information regarding the calculation of basic and diluted net income per common share for the three months ended December 31, 2018 and 2017 is as follows (dollars in thousands, except per share amounts):



	Three Months Ended December 31,
	2018		2017
Basic net income per common share computation
Numerator – net income	$	5,615	$	3,614

Denominator – weighted average common shares outstanding	8,293,212		7,312,531

Basic net income per common share	$	0.68	$	0.49

Diluted net income per common share computation
Numerator – net income	$	5,615	$	3,614

Denominator – weighted average common shares outstanding	8,293,212		7,312,531
Effect of dilutive stock options (1)	164,491		195,638
Weighted average common shares outstanding - assuming dilution	8,457,703		7,508,169

Diluted net income per common share	$	0.66	$	0.48

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(1) For the three months ended December 31, 2018, average options to purchase 102,850 shares of common were outstanding but not included in the computation of diluted net income per share because their effect would have been anti-dilutive. For the three months ended December 31, 2017, average options to purchase 14,651 shares of common stock were outstanding but not included in the computation of diluted net income per share because their effect would have been anti-dilutive.