Earnings Per Share

9 Months Ended

Sep. 30, 2011

Earnings Per Share [Abstract]

Earnings Per Share

7. Earnings Per Share

FNB United filed articles of amendment to its articles of incorporation on October 31, 2011 to effect a one-for-one hundred reverse stock split (the "Reverse Stock Split") of its common stock. The amendment became effective following the close of trading on October 31, 2011. With the filing of this quarterly report on Form 10-Q, share and per share amounts have been retrospectively adjusted for the Reverse Stock Split. A purpose of the Reverse Stock Split is to increase the per share trading price of the FNB United's common stock to satisfy the $1.00 minimum bid price requirement for continued listing on The Nasdaq Capital Market. As a result of the Reverse Stock Split, every 100 shares of the FNB United's common stock issued and outstanding prior to the opening of trading on November 1, 2011 will be consolidated into one issued and outstanding share. No fractional shares will be issued as a result of the Reverse Stock Split. Instead, any fractional share resulting from the Reverse Stock Split will be rounded up to the next largest whole share.

Basic net loss per share, or basic earnings/(loss) per share ("EPS"), is computed by dividing net loss to common shareholders by the weighted average number of common shares outstanding for the period. For the first nine months of 2011, the Company had $1.9 million of unpaid cumulative dividends on its Series A preferred stock and had $571,600 accretion of the discount on the preferred stock. At September 30, 2011, the Company had $4.2 million of unpaid cumulative dividends on the Series A preferred stock. For the first nine months of 2010, the Company accrued or paid dividends of approximately $1.9 million on Series A preferred stock, which combined with the $534,300 accretion of the discount on the preferred stock, increased the net loss to common shareholders by $2.5 million. At September 30, 2011, the Company had $697,200 of unpaid cumulative dividends on the SunTrust preferred stock.

Diluted EPS reflects the potential dilution that could occur if FNB United's potential common stock, which consists of dilutive stock options and a common stock warrant, were issued. As required for entities with complex capital structures, a dual presentation of basic and diluted EPS is included on the face of the income statement, and a reconciliation of the numerator and denominator of the basic EPS computation to the numerator and denominator of the diluted EPS computation is provided in this note.

(in thousands, except share and per share data)	Three Months Ended September 30,						Nine Months Ended September 30,
	2011			2010			2011			2010
Net loss from continuing operations	$	(13,890	)	$	(55,031	)	$	(100,889	)	$	(83,215	)
Preferred stock dividends		(1,093	)		(825	)		(3,197	)		(2,466	)
Net loss from continuing operations attributable to common shareholders		(14,983	)		(55,856	)		(104,086	)		(85,681	)
Net (loss)/income from discontinued operations attributable to common shareholders		(40	)		185			(5,722	)		(133	)
Net loss to common shareholders	$	(15,023	)	$	(55,671	)	$	(109,808	)	$	(85,814	)
Weighted average shares of common stock outstanding		114,320			114,237			114,277			114,240
Net loss per common share from continuing operations — basic and diluted	$	(131.06	)	$	(488.95	)	$	(910.82	)	$	(750.01	)
Net (loss)/income per common share from discontinued operations — basic and diluted		(0.35	)		1.62			(50.07	)		(1.16	)
Net loss per common share — basic and diluted		(131.41	)		(487.33	)		(960.89	)		(751.17	)

Due to a net loss for the three- and nine-month periods ended September 30, 2011 and 2010, all stock options and the common stock warrant were considered antidilutive and thus are not included in this calculation. For the three- and nine-month periods ended September 30, 2011, there were 26,821 and 27,218 antidilutive shares, respectively. Additionally, for the three- and nine-month periods ended September 30, 2010, there were 26,821 and 27,218 antidilutive shares, respectively. Of the antidilutive shares, the number of shares relating to stock options were 4,750 at September 30, 2011 and 2010, respectively.

Net loss to common shareholders was increased in the three- and nine-month periods ended September 30, 2011 by $1.1 million and $3.2 million, respectively, for preferred stock dividends. Net loss to common shareholders was increased in the three- and nine-month periods ended September 30, 2010 by $824,900 and $2.5 million, respectively, for preferred stock dividends. Accretion on the preferred stock discount associated with the preferred stock of $193,700 and $571,600 was reflected for the three and nine months ended September 30, 2011, respectively, and $181,100 and $534,300 for the three and nine months ended September 30, 2010, respectively.