Computation of Earnings Per Share

6 Months Ended

Jun. 30, 2011

Computation of Earnings Per Share [Abstract]

COMPUTATION OF EARNINGS PER SHARE

NOTE 3 — COMPUTATION OF EARNINGS PER SHARE

Basic earnings per share represents income available to common shareholders divided by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects additional common shares that would have been outstanding if dilutive potential common shares had been issued, as well as any adjustments to income that would result from the assumed issuance. Potential common shares that may be issued by the Corporation relate solely to outstanding shares in the Isabella Bank Corporation and Related Companies Deferred Compensation Plan for Directors (the “Directors Plan”).

Earnings per common share have been computed based on the following:

	Three Months Ended				Six Months Ended
	June 30				June 30
	2011		2010		2011		2010
Average number of common shares outstanding for basic calculation		7,570,752		7,544,629		7,564,060		7,542,693
Average potential effect of shares in the Directors Plan (1)		194,964		185,950		194,051		184,178
Average number of common shares outstanding used to calculate diluted earnings per common share		7,765,716		7,730,579		7,758,111		7,726,871
Net income	$	2,672	$	2,151	$	4,988	$	4,174
Earnings per share
Basic	$	0.35	$	0.29	$	0.66	$	0.55
Diluted	$	0.34	$	0.28	$	0.64	$	0.54

(1) Exclusive of shares held in the Rabbi Trust