Earnings Per Common Share

6 Months Ended

Jun. 30, 2021

Earnings per Common Share

LCNB has granted restricted stock awards with non-forfeitable dividend rights, which are considered participating securities. Accordingly, earnings per share is computed using the two-class method as required by ASC 260-10-45. Basic earnings per common share is calculated by dividing net income allocated to common shareholders by the weighted average number of common shares outstanding during the period, which excludes the participating securities. Diluted earnings per common share is adjusted for the dilutive effects of stock options, warrants, and restricted stock. The diluted average number of common shares outstanding has been increased for the assumed exercise of stock options and warrants with proceeds used to purchase treasury shares at the average market price for the period.

Earnings per share for the three and six months ended June 30, 2021 and 2020 were calculated as follows (dollars in thousands, except share and per share data):


	Three Months Ended June 30,			Six Months Ended June 30,
	2021		2020	2021	2020
Net income	$	5,290	5,057	10,530	10,083
Less allocation of earnings and dividends to participating securities	19		12	38	23
Net income allocated to common shareholders	$	5,271	5,045	10,492	10,060

Weighted average common shares outstanding, gross	12,789,684		12,970,570	12,815,089	12,963,123
Less average participating securities	45,958		29,595	45,958	29,595
Weighted average number of shares outstanding used in the calculation of basic earnings per common share	12,743,726		12,940,975	12,769,131	12,933,528
Add dilutive effect of:
Stock options	—		26	15	630
Adjusted weighted average number of shares outstanding used in the calculation of diluted earnings per common share	12,743,726		12,941,001	12,769,146	12,934,158

Earnings per common share:
Basic	$	0.41	0.39	0.82	0.78
Diluted	0.41		0.39	0.82	0.78

There were no anti-dilutive stock options outstanding at June 30, 2021 or 2020.