3. Earnings per Common Share

9 Months Ended

Sep. 30, 2013

Notes to Financial Statements

Note 3. Earnings per Common Share

Earnings per common share amounts are computed based on the weighted average number of shares of common stock issued during the period (retroactively adjusted for stock splits and stock dividends), including Dividend Reinvestment Plan shares issuable upon reinvestment of dividends declared, and reduced for shares held in treasury.

The following tables illustrate the calculation for the periods ended September 30, as adjusted for the cash dividends declared on the preferred stock:

For The Quarters Ended September 30,	2013		2012
Net income, as reported	$	1,354,933	$	1,267,351
Less: dividends to preferred shareholders (1)		20,313		46,875
Net income available to common shareholders	$	1,334,620	$	1,220,476
Weighted average number of common shares
used in calculating earnings per share		4,845,044		4,781,877
Earnings per common share	$	0.28	$	0.26
For The Nine Months Ended September 30,	2013		2012
Net income, as reported	$	3,635,055	$	3,253,392
Less: dividends to preferred shareholders (1)		60,938		140,625
Net income available to common shareholders	$	3,574,117	$	3,112,767
Weighted average number of common shares
used in calculating earnings per share		4,831,084		4,759,383
Earnings per common share	$	0.74	$	0.65

(1) Reflects a reduction in the dividend rate paid on the preferred stock, effective January 1, 2013, from a fixed rate of 7.50% to a quarterly adjustable rate equal to the Wall Street Journal Prime Rate in effect on the first business day of the quarter.