Earnings per Share

The Corporation uses the two-class method to calculate earnings per share as the unvested restricted stock issued under the Corporation's equity incentive plans are participating shares with nonforfeitable rights to dividends. Under the two-class method, earnings per common share are computed by dividing the sum of distributed earnings to common shareholders and undistributed earnings allocated to common shareholders by the weighted average number of common shares outstanding for the period. In applying the two-class method, undistributed earnings are allocated to both common shares and participating securities based on the number of weighted average shares outstanding during the period. The table also notes anti-dilutive options which are those options with weighted average exercise prices in excess of the weighted average market value for the periods presented.

The following table sets forth the computation of basic and diluted earnings per share:



	Three Months Ended June 30,						Six Months Ended June 30,
(Dollars and shares in thousands, except per share data)	2018			2017			2018			2017
Numerator:
Net income	$	4,357		$	11,778		$	17,207		$	22,634
Net income allocated to unvested restricted stock	(33		)	(122		)	(132		)	(234		)
Net income allocated to common shares	$	4,324		$	11,656		$	17,075		$	22,400
Denominator:
Weighted average shares outstanding	29,404			26,661			29,380			26,647
Average unvested restricted stock	(228		)	(281		)	(221		)	(284		)
Denominator for basic earnings per share—weighted-average shares outstanding	29,176			26,380			29,159			26,363
Effect of dilutive securities—employee stock options	95			97			95			100
Denominator for diluted earnings per share—adjusted weighted-average shares outstanding	29,271			26,477			29,254			26,463
Basic earnings per share	$	0.15		$	0.44		$	0.59		$	0.85
Diluted earnings per share	$	0.15		$	0.44		$	0.58		$	0.85
Average anti-dilutive options excluded from computation of diluted earnings per share	369			188			294			157