Earnings Per Share

12 Months Ended

Dec. 31, 2019

In February 2019, the Company’s Compensation Committee of Board of Directors reviewed the various forms of outstanding equity awards, including restricted stock and restrict stock units (“RSUs”), and approved that unvested restricted stock awards will be considered participating securities. As a result of the different treatment of unvested restricted stock and unvested RSUs, beginning in 2019, earnings per common share is computed using the two-class method.

Under the two-class method, distributed and undistributed earnings allocable to participating securities are deducted from net income to determine net income allocable to common shareholders, which is then used in the numerator of both basic and diluted earnings per share calculations. Basic earnings per common share is computed by dividing net income allocable to common shareholders by the weighted average number of common shares outstanding for the reporting period, excluding outstanding participating securities. Diluted earnings per common share is computed by dividing net income allocable 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, but excludes awards considered participating securities. The computation of diluted earnings per common share excludes the impact of the assumed exercise or issuance of securities that would have an anti-dilutive effect.

The following tables set forth the Company’s earnings per share calculations for the periods indicated:



	For the Year Ended December 31,
	2019			2018		2017
	(dollars in thousands, except per share data)
Basic
Net income	$	159,718		$	123,340	$	60,100
Less: Earnings allocated to participating securities	(1,650		)	—		—
Net income allocated to common stockholders	$	158,068		$	123,340	$	60,100

Weighted average common shares outstanding	60,339,714			53,963,047		37,705,556
Basic earnings per common share	$	2.62		$	2.29	$	1.59

Diluted
Net income allocated to common stockholders	$	158,068		$	123,340	$	60,100

Weighted average common shares outstanding	60,339,714			53,963,047		37,705,556
Diluted effect of share-based compensation	352,567			650,010		805,705
Weighted average diluted common shares	60,692,281			54,613,057		38,511,261
Diluted earnings per common share	$	2.60		$	2.26	$	1.56

The impact of stock options, which are anti-dilutive are excluded from the computations of diluted earnings per share. The dilutive impact of these securities could be included in future computations of diluted earnings per share if the market price of the common stock increases. There are no RSUs or stock options that were anti-dilutive at December 31, 2019 and 2018. The weighted average number of stock options excluded was 17,524 for December 31, 2017.