Note 5 - Stockholders' Equity and Earnings Per Common Share

6 Months Ended

Jun. 30, 2013

Other Comprehensive Income And Earnings Per Common Share Disclosure [Abstract]

Other Comprehensive Income And Earnings Per Common Share Disclosure [Text Block]

NOTE 5: Stockholders’ Equity and Earnings Per Common Share

Stockholders’ Equity - Other Comprehensive Income

The following table presents the cumulative balances of the components of other comprehensive income, net of deferred tax assets of $536,000 and $2.51 million as of June 30, 2013 and December 31, 2012, respectively.

(Dollars in thousands)	June 30, 2013			December 31, 2012
Net unrealized gains on securities	$	2,187		$	5,951
Net unrecognized loss on cash flow hedges		(242	)		(313	)
Net unrecognized losses on defined benefit pension plan		(904	)		(922	)
Total cumulative other comprehensive income	$	1,041		$	4,716

Earnings Per Common Share

The components of the Corporation’s earnings per common share calculations are as follows:

(Dollars in thousands)	Three Months Ended June 30,
	2013		2012
Net income	$	4,178	$	4,181
Accumulated dividends on Series A Preferred Stock		—		(14	)
Accretion of Series A Preferred Stock discount		—		(151	)
Net income available to common shareholders	$	4,178	$	4,016
Weighted average number of common shares used in earnings per common share – basic		3,276,039		3,208,792
Effect of dilutive securities:
Stock option awards and Warrant		137,013		87,353
Weighted average number of common shares used in earnings per common share – assuming dilution		3,413,052		3,296,145

(Dollars in thousands)	Six Months Ended June 30,
	2013		2012
Net income	$	8,184	$	7,961
Accumulated dividends on Series A Preferred Stock		—		(139	)
Accretion of Series A Preferred Stock discount		—		(172	)
Net income available to common shareholders	$	8,184	$	7,650
Weighted average number of common shares used in earnings per common share – basic		3,271,376		3,199,655
Effect of dilutive securities:
Stock option awards and Warrant		120,789		80,905
Weighted average number of common shares used in earnings per common share – assuming dilution		3,392,165		3,280,560

Potential common shares that may be issued by the Corporation for its stock option awards and Warrant (defined below) are determined using the treasury stock method. Approximately 500 and 276,500 shares issuable upon exercise of options were not included in computing diluted earnings per common share for the three months ended June 30, 2013 and 2012, respectively, and approximately 35,100 and 276,500 shares issuable upon exercise of options were not included in computing diluted earnings per common share for the six months ended June 30, 2013 and 2012, respectively, because they were anti-dilutive.

In January 2009, the Corporation issued to the United States Department of the Treasury (Treasury) under the Capital Purchase Program (CPP) $20.00 million of its Fixed Rate Cumulative Perpetual Preferred Stock, Series A (the Preferred Stock) and a warrant to purchase 167,504 shares of the Corporation’s common stock (the Warrant). On July 27, 2011, the Corporation redeemed $10.00 million of the Preferred Stock, and on April 12, 2012, the Corporation redeemed the remaining $10.00 million of the Preferred Stock.  As a result of this redemption, the Corporation will pay no future dividends on the Preferred Stock. Further, in connection with this redemption, the Corporation accelerated the accretion of the remaining preferred stock discount during April 2012, which reduced net income available to common shareholders by approximately $151,000.