The following table presents the computation of basic and diluted earnings per common share for the periods indicated:



	Three Months Ended September 30,
(Dollars in millions, except per share amounts)	2018			2017
Net income	$	765		$	685
Less:
Preferred stock dividends	(55		)	(55		)
Dividends and undistributed earnings allocated to participating securities⁽¹⁾	(1		)	(1		)
Net income available to common shareholders	$	709		$	629
Average common shares outstanding (In thousands):
Basic average common shares	374,963			372,765
Effect of dilutive securities: equity-based awards	4,420			5,753
Diluted average common shares	379,383			378,518
Anti-dilutive securities⁽²⁾	1,360			—
Earnings per common share:
Basic	$	1.89		$	1.69
Diluted⁽³⁾	1.87			1.66

	Nine Months Ended September 30,
(Dollars in millions, except per share amounts)	2018			2017
Net income	$	2,160		$	1,807
Less:
Preferred stock dividends	(146		)	(146		)
Dividends and undistributed earnings allocated to participating securities⁽¹⁾	(2		)	(2		)
Net income available to common shareholders	$	2,012		$	1,659
Average common shares outstanding (In thousands):
Basic average common shares	369,368			376,430
Effect of dilutive securities: equity-based awards	4,696			5,349
Diluted average common shares	374,064			381,779
Anti-dilutive securities⁽²⁾	871			250
Earnings per common share:
Basic	$	5.45		$	4.41
Diluted⁽³⁾	5.38			4.35

⁽¹⁾Represents the portion of net income available to common equity allocated to participating securities, composed of unvested and fully vested SERP shares and fully vested deferred director stock awards, which are equity-based awards that contain non-forfeitable rights to dividends, and are considered to participate with the common stock in undistributed earnings.

⁽²⁾Represents equity-based awards outstanding but not included in the computation of diluted average common shares, because their effect was anti-dilutive. For additional information about equity-based awards, refer to pages 173 to 175 in Note 18 to the consolidated financial statements included under Item 8, Financial Statements and Supplementary Data, in our 2017 Form 10-K.

⁽³⁾Calculations reflect allocation of earnings to participating securities using the two-class method, as this computation is more dilutive than the treasury stock method.