EARNINGS PER SHARE

3 Months Ended

Mar. 31, 2017

EARNINGS PER SHARE

EARNINGS PER SHARE

3.EARNINGS PER SHARE

Diluted earnings per share, which reflects the potential dilution that could occur if outstanding stock options were exercised and stock awards were fully vested and resulted in the issuance of common stock that then shared in our earnings, is computed by dividing net income by the weighted average number of common shares outstanding and common stock equivalents, after giving effect for dilutive shares issued.

The following shows the computation of basic and diluted earnings per share for the three months ended March 31, 2017 and 2016 (dollars in thousands, except per share data):

	Three Months Ended March 31,
	2017		2016
(Numerator):
Net income	$	1,726	$	1,132
(Denominator):
Weighted average shares outstanding		6,270,034		6,214,083
Effect of dilutive stock options, and vesting of restricted stock awards		10,343		13,902
Diluted weighted average shares outstanding		6,280,377		6,227,985
Income per common share:
Basic	$	.28	$	.18
Diluted	$	.28	$	.18