Earnings Per Share

9 Months Ended

Sep. 30, 2013

Earnings Per Share

Earnings Per Share

Note 9. Earnings Per Share

Earnings per common share is computed using the two-class method.  Basic earnings per common share is computed by dividing net income available to common shareholders by the weighted-average number of common shares outstanding during the applicable period, excluding outstanding participating securities.  Participating securities include non-vested restricted stock awards.  Non-vested restricted stock awards are considered participating securities to the extent the holders of these securities receive non-forfeitable dividends at the same rate as holders of common stock.  Diluted earnings per common share is computed using the weighted-average number of shares determined for the basic earnings per common share computation plus the dilutive effect of stock compensation using the treasury stock method.  Stock options, where the exercise price was greater than the average market price of the common shares, were excluded from the computation of diluted earnings per common share because the result would have been antidilutive.

There were no stock options outstanding as of September 30, 2013.  No stock options were considered antidilutive as of September 30, 2012.

The following table presents a reconciliation of the number of shares used in the calculation of basic and diluted earnings per common share for the three and nine months ended September 30, 2013 and 2012.

	Three Months Ended				Nine Months Ended
	September 30,				September 30,
(Dollars in thousands - except per share amounts)	2013		2012		2013		2012
Distributed earnings allocated to common stock	$	4,146	$	4,127	$	12,429	$	11,899
Undistributed earnings allocated to common stock	10,552		8,706		28,271		24,872
Net earnings allocated to common stock	14,698		12,833		40,700		36,771
Net earnings allocated to participating securities	198		172		542		516
Net income allocated to common stock and participating securities	$	14,896	$	13,005	$	41,242	$	37,287
Weighted average shares outstanding for basic earnings per common share	24,366,220		24,279,178		24,352,073		24,267,535
Dilutive effect of stock compensation	889		10,317		781		10,625
Weighted average shares outstanding for diluted earnings per common share	24,367,109		24,289,495		24,352,854		24,278,160
Basic earnings per common share	$	0.60	$	0.53	$	1.67	$	1.52
Diluted earnings per common share	$	0.60	$	0.53	$	1.67	$	1.51