Earnings Per Share

3 Months Ended

Mar. 31, 2013

Earnings Per Share

Earnings Per Share

Note 12.  Earnings Per Share

Basic earnings per common share are computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding for the reporting period.  Diluted earnings per common share are computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding over the reporting period, adjusted to include the effect of potentially dilutive common shares.  Potentially dilutive common shares are calculated using the treasury stock method and include incremental shares issuable upon exercise of outstanding stock options, other share-based compensation awards and any other security in which its conversion / exercise may result in the issuance of common stock, such as the warrant the Company issued to the U.S. Treasury during 2009 or the Series C Perpetual Preferred Stock the Company issued during 2010.  The computation of diluted earnings per common share excludes the impacts of the assumed exercise or issuance of securities that would have an anti-dilutive effect, which can occur when the Company reports a net loss or when the market price for the Company’s stock falls below the exercise price of equity awards issued by the Company.  For the three months ended March 31, 2013 and 2012, common stock equivalents, primarily options, totaling approximately 325,000 shares and 321,000 shares, respectively, were excluded from the calculation of diluted earnings per share, as their impact would be anti-dilutive.  The diluted earnings per share for the for the three months ended March 31, 2012 also excludes the impact of approximately 612,000 shares potentially issuable under the warrant issued as part of the Series A Preferred Share issuance (see Note 11. Preferred Stock, of these Condensed Consolidated Financial Statements), as their impact would also be anti-dilutive.

The following table sets forth the number of shares used in the calculation of both basic and diluted earnings per common share:

	For the Three Months Ended March 31,
	2013			2012
(dollar amounts in thousands except per share data)	Net Income		Shares	Net Income		Shares
Net income	$	3,730		$	1,585
Dividends and accretion on preferred stock	(358)			(381)
Net income  available to common shareholders	$	3,372		$	1,204
Weighted average shares outstanding			25,112,004			25,057,664
Basic earnings per common share	$	0.13		$	0.05
Dilutive effect of share-based compensation awards, common stock warrants, and convertible perpetual preferred stock			1,415,453			1,232,706
Weighted average diluted shares outstanding			26,527,457			26,290,370
Diluted earnings per common share	$	0.13		$	0.05