Note 2: Earnings Per Share

Earnings per common share (EPS) is computed using the two-class method. Basic earnings per common share is computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding during the applicable period, excluding participating securities. Participating securities include non-vested restricted stock awards. Non-vested restricted stock awards are considered participating securities to the extent the holders of these securities receive non-forfeitable dividends at the same rate as holders of common shares. Diluted earnings per common share is computed using the weighted-average number of shares determined for the basic earnings per common share plus the convertible impact of preferred shares and the dilutive effect of stock compensation using the treasury stock method. EPS for the years ended December 31, 2018 and 2017 is computed as follows:

	Twelve Months Ended Dec., 31
($ and outstanding shares in thousands, except per share data)	2018		2017

Distributed earnings allocated to common shares	$	2,090	$	1,363
Undistributed earnings allocated to common shares		8,558		8,714
Net earnings allocated to common shares		10,648		10,077
Net earnings allocated to participating securities		15		13
Dividends on convertible preferred shares		975		975

Net Income allocated to common shares and participating securities	$	11,638	$	11,065

Weighted-average shares outstanding for basic earnings per share		6,198		4,817
Dilutive effect of stock compensation		61		74
Dilutive effect of convertible shares		1,460		1,460

Weighted-average shares outstanding for diluted earnings per share		7,719		6,351

Basic earnings per common share	$	1.72	$	2.10

Diluted earnings per common share	$	1.51	$	1.74

There were no anti-dilutive shares in 2018 or 2017.