Net Income Per Common Share

9 Months Ended

Sep. 30, 2020

NET INCOME PER COMMON SHARE

Basic and diluted net income per common share are presented in the following table.


	Three Months Ended September 30,				Nine Months Ended September 30,

(in millions, except per share data)	2020		2019		2020		2019
Basic and diluted
Net income	$	211	$	292	$	259	$	929
Less:
Income allocated to participating securities	—		2		1		5
Preferred stock dividends	8		—		8		—
Net income attributable to common shares	$	203	$	290	$	250	$	924
Basic average common shares	139		147		139		152
Basic net income per common share	$	1.45	$	1.98	$	1.79	$	6.08
Basic average common shares	139		147		139		152
Dilutive common stock equivalents:
Net effect of the assumed exercise of stock awards	1		1		1		2

Diluted average common shares	140		148		140		154
Diluted net income per common share	$	1.44	$	1.96	$	1.78	$	6.02

The following average shares related to outstanding options to purchase shares of common stock were not included in the computation of diluted net income per common share because the options were anti-dilutive for the period.



	Three Months Ended September 30,		Nine Months Ended September 30,
(average outstanding options in thousands)	2020	2019	2020	2019
Average outstanding options	2,029	814	1,497	570
Range of exercise prices	$39.10 - $95.25	$67.53 - $95.25	$49.51 - $95.25	$67.53 - $95.25

In May 2020, the Corporation issued and sold 400,000 depositary shares, each representing a 1/100th ownership interest in a share of 5.625% Fixed-Rate Reset Non-Cumulative Perpetual Preferred Stock, Series A, without par value, with a liquidation preference of $100,000 per share (equivalent of $1,000 per depositary share). Holders of the depositary shares will be entitled to all proportional rights and preferences of the Series A preferred stock (including dividend, voting, redemption and liquidation rights). The $400 million issuance yielded $394 million in proceeds net of underwriting discounts and offering expenses. Dividends on the Series A preferred stock will accrue on a non-cumulative basis and will be payable in arrears when, as and if authorized by the Corporation’s Board of Directors or a duly authorized committee of the Board and declared by the Corporation, on the first day of January, April, July and October of each year, commencing on October 1, 2020. Under the terms of the Series A preferred stock, the ability of the Corporation to pay dividends on, make distributions with respect to, or to repurchase, redeem or acquire its common stock or any other stock ranking on parity with or junior to the Series A preferred stock, is subject to restrictions in the event that the Corporation does not declare and either pay or set aside a sum sufficient for payment of dividends on the Series A preferred stock for the immediately preceding dividend period. The Series A preferred stock is perpetual and has no maturity date, but is redeemable at specified times subject to regulatory considerations.