Earnings Per Share

6 Months Ended

Jun. 30, 2011

Note 3 — Earnings Per Share (“EPS”)

Basic and diluted earnings per share were computed as follows:

			Effect of
(Dollars in millions, except per share amounts)	Basic		Dilution		Diluted
Three Months Ended June 30,
2011
Shareholders' net income	$	408			$	408
Shares (in thousands):
Weighted average		268,557				268,557
Common stock equivalents				4,176		4,176
Total shares		268,557		4,176		272,733
EPS	$	1.52	$	(0.02)	$	1.50
2010
Shareholders' net income	$	294			$	294
Shares (in thousands):
Weighted average		275,107				275,107
Common stock equivalents				2,429		2,429
Total shares		275,107		2,429		277,536
EPS	$	1.07	$	(0.01)	$	1.06

			Effect of
(Dollars in millions, except per share amounts)	Basic		Dilution		Diluted
Six Months Ended June 30,
2011
Shareholders' net income	$	837			$	837
Shares (in thousands):
Weighted average		269,464				269,464
Common stock equivalents				3,836		3,836
Total shares		269,464		3,836		273,300
EPS	$	3.11	$	(0.05)	$	3.06
2010
Shareholders' net income	$	577			$	577
Shares (in thousands):
Weighted average		275,398				275,398
Common stock equivalents				2,421		2,421
Total shares		275,398		2,421		277,819
EPS	$	2.10	$	(0.02)	$	2.08

The following outstanding employee stock options were not included in the computation of diluted earnings per share because their effect would have increased diluted earnings per share (antidilutive) as their exercise price was greater than the average share price of the Company's common stock for the period.

	Three Months Ended		Six Months Ended
	June 30,		June 30,
(In millions)	2011	2010	2011	2010
Antidilutive options	2.9	6.8	3.5	6.0

The Company held 80,740,132 shares of common stock in Treasury as of June 30, 2011, and 77,905,033 shares as of June 30, 2010.