Earnings (Loss) per Share

3 Months Ended

Mar. 31, 2014

(10) Earnings (Loss) per Share

Basic earnings (loss) per share is computed by dividing income available to common shareholders by the weighted average number of common shares outstanding during the year. Diluted earnings (loss) per share gives effect to all dilutive potential common shares that were outstanding during the year. The calculations of basic and diluted earnings (loss) per share are as follows for the periods indicated:

	Three Months Ended March 31,
(dollars in thousands, except per share data)	2014		2013
Basic earnings (loss) per common share:
Net income (loss)	$	1,987	$	(136	)
Less:
Preferred stock dividends and accretion of discount	0		295
Net income (loss) available to common shareholders	$	1,987	$	(431	)
Basic earnings (loss) per share	$	0.39	$	(0.09	)
Diluted earnings (loss) per common share:
Net income (loss)	$	1,987	$	(136	)
Less:
Preferred stock dividends and accretion of discount	0		295
Net income (loss) available to common shareholders	$	1,987	$	(431	)
Average shares outstanding	5,032,679		5,032,679
Effect of dilutive stock options	0		0
Average shares outstanding including dilutive stock options	5,032,679		5,032,679
Diluted earnings (loss) per share	$	0.39	$	(0.09	)

Under the treasury stock method, outstanding stock options are dilutive when the average market price of the Company’s common stock, when combined with the effect of any unamortized compensation expense, exceeds the option price during the period, except when the Company has a loss from continuing operations available to common shareholders. In addition, proceeds from the assumed exercise of dilutive options along with the related tax benefit are assumed to be used to repurchase common shares at the average market price of such stock during the period.

The following options to purchase shares during the dates indicated were not included in the respective computations of diluted earnings per share because the exercise price of the option, when combined with the effect of the unamortized compensation expense, was greater than the average market price of the common shares and were considered anti-dilutive.

	Three Months Ended March 31,
	2014	2013
Anti-dilutive shares - option shares	103,150	188,491
Anti-dilutive shares - warrant shares	—	298,618
Total anti-dilutive shares	103,150	487,109

- Definition

The entire disclosure for earnings per share.

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