2) Shareholders’ Equity and Earnings Per Share

Basic earnings per common share is computed by dividing net income by the weighted average common shares outstanding. Diluted earnings per share reflect potential dilution from outstanding stock options using the treasury stock method. There were 305,500 and 369,606 stock options for the three months ended June 30, 2018 and 2017, and 318,606 and 369,500 for the six months ended June 30, 2018 and 2017, respectively, considered to be antidilutive and excluded from the computation of diluted earnings per share. A reconciliation of these factors used in computing basic and diluted earnings per common share is as follows:


	Three Months Ended				Six Months Ended
	June 30,				June 30,
	2018		2017		2018		2017
		(Dollars in thousands, except per share amounts)
Net income	$	915	$	7,449	$	9,724	$	13,987

Weighted average common shares outstanding for basic
earnings per common share		41,925,616		38,070,042		40,083,056		38,014,020
Dilutive effect of stock options outstanding, using
the treasury stock method		583,058		509,092		577,027		521,995
Shares used in computing diluted earnings per common share		42,508,674		38,579,134		40,660,083		38,536,015

Basic earnings per share	$	0.02	$	0.20	$	0.24	$	0.37
Diluted earnings per share	$	0.02	$	0.19	$	0.24	$	0.36