OUTSTANDING SHARES AND EARNINGS PER SHARE

9 Months Ended

Sep. 30, 2022

OUTSTANDING SHARES AND EARNINGS PER SHARE [Abstract]

OUTSTANDING SHARES AND EARNINGS PER SHARE

10.  OUTSTANDING SHARES AND EARNINGS PER SHARE

On January 27, 2022, the Board of Directors of the Company declared a 5% stock dividend payable March 25, 2022 to shareholders of record as of February 28, 2022. All income per share amounts have been adjusted to give retroactive effect to stock dividends.

Earnings Per Share (EPS)

Basic EPS includes no dilution and is computed by dividing net income available to common shareholders by the weighted average number of common shares outstanding for the respective period. Diluted EPS is computed by dividing net income available to common shareholders by the weighted average number of shares outstanding plus dilutive shares for the quarter. Diluted shares include all common stock equivalents (“in-the-money” stock options, unvested restricted stock, stock units, warrants and rights, convertible bonds and preferred stock), which reflects the potential dilution of securities that could share in the earnings of the Company.

The following table presents a reconciliation of basic and diluted EPS for the three and nine months ended September 30, 2022 and 2021 (dollars in thousands except per share amounts):

	Three months ended September 30,				Nine months ended September 30,
	2022		2021		2022		2021
Basic earnings per share:
Net income	$	4,568	$	4,509	$	11,155	$	10,993
Weighted average common shares outstanding		13,713,657		14,018,259		13,704,178		14,115,162
Basic EPS	$	0.33	$	0.32	$	0.81	$	0.78
Diluted earnings per share:
Net income	$	4,568	$	4,509	$	11,155	$	10,993
Weighted average common shares outstanding		13,713,657		14,018,259		13,704,178		14,115,162
Effect of dilutive shares		143,497		188,615		154,998		178,363
Adjusted weighted average common shares outstanding		13,857,154		14,206,874		13,859,176		14,293,525
Diluted EPS	$	0.33	$	0.32	$	0.80	$	0.77

Stock options which were not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 488,627 shares and 267,950 shares for the three months ended September 30, 2022 and 2021, respectively. Unvested restricted stock which were not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 70,973 shares and 0 shares for the three months ended September 30, 2022 and 2021, respectively. Stock options which were not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 393,652 shares and 288,774 shares for the nine months ended September 30, 2022 and 2021, respectively. Unvested restricted stock which were not included in the computation of diluted earnings per share because they would have had an anti-dilutive effect amounted to 59,015 shares and 13,957 shares for the nine months ended September 30, 2022 and 2021, respectively.