Earnings (Losses) Per Share

6 Months Ended

Jun. 30, 2011

Earnings Per Share [Abstract]

Disclosure of Compensation Related Costs, Share-based Payments [Text Block]

27. Earnings (Losses) Per Share Data

The reconciliation of the numerator and denominator of the earnings (losses) per share follows:

		Quarters Ended				Six Month Periods Ended
		June 30,				June 30,
(Dollars in thousands, except per share amounts)		2011		2010		2011		2010
Net Income (Loss):
	Net income (loss)	$	4,477	$	(233,311)	$	7,800	$	(236,814)
	Non-convertible preferred stock dividend		—		—		—		—
	Convertible preferred stock dividend		(2,415)		(2,415)		(4,830)		(4,279)
	Effect of conversion of preferred stock (1)		—		—		—		26,585
	Net income (loss) attributable to common shareholders	$	2,062	$	(235,726)	$	2,970	$	(214,508)
Weighted-Average Number of Common Shares Outstanding (2)			127,293,756		67,285,568		127,293,756		64,920,036
Net Income (loss) per Common Share (3)		$	0.02	$	(3.50)	$	0.02	$	(3.30)

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• The carrying value of the noncumulative preferred stock exceeded the fair value of consideration transferred and, accordingly, the difference between the liquidation preference of the preferred stock retired and the market value of the common stock issued amounted to $31.6 million for the six month period ended June 30, 2010, and was credited to retained earnings. In the case of the convertible preferred stock, the fair value of stock exchanged for the preferred stock converted exceeded the fair value of the stock issuable pursuant to the original conversion terms and, accordingly, this excess or inducement amounted to $5.1 million for the six month periods ended June 30, 2010and was charged to retained earnings. As a result, both transactions impacted the net income (loss)attributable to common shareholders.
• Potential common shares consist of common stock issuable under the assumed exercise of stock options and unvested shares of restricted stock using the treasury stock method. This method assumes that the potential common shares are issued and the proceeds from exercise in addition to the amount of compensation cost attributed to future services are used to purchase common stock at the exercise date. The difference between the number of potential shares issued and the shares purchased is added as incremental shares to the actual number of shares outstanding to compute diluted earnings per share. Stock options and unvested shares of restricted stock that result in lower potential shares issued than shares purchased under the treasury stock method are not included in the computation of dilutive earnings (losses) per share since their inclusion would have an antidilutive effect in earnings per share. As of June 30, 2011, there were granted 60,000 stock options and 4,323,728shares of restricted stock.
• For the quarters and six month periods ended June 30, 2011 and 2010, net income (loss)per common share represents both the basic and diluted earnings (losses) per common share, respectively, for each of the periods presented.

On March 20, 2009, the Board of Directors of Doral Financial announced that it had suspended the declaration and payment of all dividends on all of Doral Financial's outstanding series of cumulative and non-cumulative preferred stock. The suspension of dividends was effective and commenced with the dividends for the month of April 2009 for Doral Financial's three outstanding series of non-cumulative preferred stock, and the dividends for the second quarter of 2009 for Doral Financial's one outstanding series of cumulative preferred stock.

For the quarters ended June 30, 2011 and 2010, there were 813,526 shares of the Company's 4.75% perpetual cumulative convertible preferred stock that were excluded from the computation of diluted earnings per share because their effect would have been antidilutive. Each share of convertible preferred stock is currently convertible into 0.31428 shares of common stock, subject to adjustment under specific conditions. The option of the purchasers to convert the convertible preferred stock into shares of the Company's common stock is exercisable only (a) if during any fiscal quarter after September 30, 2003, the closing sale price of the Company's common stock for at least 20 trading days in a period of 30 consecutive trading days ending on the last trading date of the preceding fiscal quarter exceeds 120% of the conversion price of the convertible preferred stock (currently 120% of $795.47, or $954.56); (b) upon the occurrence of certain corporate transactions; or (c) upon the delisting of the Company's common stock. On or after September 30, 2008, the Company may, at its option, cause the convertible preferred stock to be converted into the number of shares of common stock that are issuable at the conversion price. The Company may only exercise its conversion right if the closing sale price of the Company's common stock exceeds 130% of the conversion price of the convertible preferred stock (currently 130% of $795.47, or $1,034.11) in effect for 20 trading days within any period of 30 consecutive trading days ending on a trading day not more than two trading days prior to the date the Company gives notice of conversion.