Quarterly report pursuant to Section 13 or 15(d)

Earnings Per Common Share

v2.4.0.8
Earnings Per Common Share
 6 Months Ended
Jun. 30, 2013
Earnings Per Share [Abstract]  
Earnings Per Common Share
NOTE 14 – Earnings Per Common Share

The calculation of earnings per common share (EPS) and diluted EPS for the three and six months ended June 30, 2013 and 2012 is presented below. See Note 1 – Summary of Significant Accounting Principles to the Consolidated Financial Statements of the Corporation's 2012 Annual Report on Form 10-K for additional information on the calculation of EPS.

 
Three Months Ended June 30
 
Six Months Ended June 30
(Dollars in millions, except per share information; shares in thousands)
2013
 
2012
 
2013

2012
Earnings per common share
 
 
 
 
 
 
 
Net income
$
4,012

 
$
2,463

 
$
5,495

 
$
3,116

Preferred stock dividends
(441
)
 
(365
)
 
(814
)
 
(690
)
Net income applicable to common shareholders
$
3,571

 
$
2,098

 
$
4,681

 
$
2,426

Dividends and undistributed earnings allocated to participating securities
(1
)
 
(1
)
 
(1
)
 
(2
)
Net income allocated to common shareholders
$
3,570

 
$
2,097

 
$
4,680

 
$
2,424

Average common shares issued and outstanding
10,775,867

 
10,775,695

 
10,787,357

 
10,714,881

Earnings per common share
$
0.33

 
$
0.19

 
$
0.43

 
$
0.23

 
 
 
 
 
 
 
 
Diluted earnings per common share
 
 
 
 
 
 
 
Net income applicable to common shareholders
$
3,571

 
$
2,098

 
$
4,681

 
$
2,426

Add preferred stock dividends due to assumed conversions
75

 
75

 
150

 
150

Dividends and undistributed earnings allocated to participating securities
(1
)
 
(1
)
 
(1
)
 
(2
)
Net income allocated to common shareholders
$
3,645

 
$
2,172

 
$
4,830

 
$
2,574

Average common shares issued and outstanding
10,775,867

 
10,775,695

 
10,787,357

 
10,714,881

Dilutive potential common shares (1)
748,643

 
780,316

 
762,336

 
795,064

Total diluted average common shares issued and outstanding
11,524,510

 
11,556,011

 
11,549,693

 
11,509,945

Diluted earnings per common share
$
0.32

 
$
0.19

 
$
0.42

 
$
0.22

(1) 
Includes incremental shares from restricted stock units, restricted stock, stock options and warrants.

The Corporation previously issued a warrant to purchase 700 million shares of the Corporation's common stock to the holder of the Corporation's 6% Cumulative Perpetual Preferred Stock, Series T (the Series T Preferred Stock). The warrant may be exercised, at the option of the holder, through tendering the Series T Preferred Stock or paying cash. For both the three and six months ended June 30, 2013 and 2012, 700 million average dilutive potential common shares associated with the Series T Preferred Stock were included in the diluted share count under the "if-converted" method.

For both the three and six months ended June 30, 2013 and 2012, 62 million average dilutive potential common shares associated with the 7.25% Non-cumulative Perpetual Convertible Preferred Stock, Series L were not included in the diluted share count because the result would have been antidilutive under the "if-converted" method. For the three and six months ended June 30, 2013, average options to purchase 124 million and 129 million shares of common stock were outstanding but not included in the computation of EPS because the result would have been antidilutive under the treasury stock method compared to 161 million and 169 million for the same periods in 2012. For both the three and six months ended June 30, 2013 and 2012, average warrants to purchase 272 million shares of common stock were outstanding but not included in the computation of EPS because the result would have been antidilutive under the treasury stock method.