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EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2020

Note 2—Earnings Per Common Share

The following reconciles the numerator and denominator of the basic and diluted earnings per common share computation:

(In thousands except average market price)

	Three months ended
	March 31,
	2020		2019
Numerator (Net income available to common shareholders)	$	1,794	$	2,495
Denominator
Weighted average common shares outstanding for:
Basic shares		7,421		7,634
Dilutive securities:
Deferred compensation		38		52
Warrants/Restricted stock -Treasury stock method		9		39
Diluted shares		7,468		7,725
The average market price used in calculating assumed number of shares	$	19.03	$	19.90

There were no options outstanding as of March 31, 2020 and 2019.

In the fourth quarter of 2011, we issued $2.5 million in 8.75% subordinated notes maturing December 16, 2019. On November 15, 2012, the subordinated notes were redeemed in full at par. In connection with the issuance of the subordinated debt, the Company issued warrants for 107,500 shares of common stock at $5.90 per share. There were 36,550 warrants outstanding at March 31, 2019 and these warrants are included in dilutive securities in the table above. All warrants were exercised by their expiration date of December 16, 2019.

In 2006, the Company established a Non-Employee Director Deferred Compensation Plan, whereby a director may elect to defer all or any part of annual retainer and monthly meeting fees payable with respect to service on the board of directors or a committee of the board. Units of common stock are credited to the director’s account at the time compensation is earned and are included in dilutive securities in the table above. The non-employee director’s account balance is distributed by issuance of common stock at the time of retirement or resignation from the board of directors. At March 31, 2020 and December 31, 2019, there were 100,215 and 97,104 units in the plan, respectively. The accrued liability at March 31, 2020 and December 31, 2019 amounted to $1.2 million and $1.1 million, respectively, and is included in “Other liabilities” on the balance sheet.