HMN Financial, Inc. Computation of Earnings Per Common Share (Unaudited) Computation of Earnings Per Three Months Ended Nine Months Ended Common Share for Statements September 30, September 30, of Operations: 1996 1995 1996 1995 - --------------------------- ---------- ---------- ---------- ---------- Net income (loss) $ (144,527) 1,414,094 2,975,248 4,182,991 ---------- ---------- ---------- ---------- Weighted average number of common share and common share equivalents: Weighted average common shares outstanding 4,185,867 5,104,878 4,474,903 5,266,435 Dilutive effect of stock option plans after application of treasury stock method 20,978 35,039 6,993 ---------- ---------- ---------- ---------- 4,185,867 5,125,856 4,509,942 5,273,428 ---------- ---------- ---------- ---------- Earnings (loss) per common share and common share equivalents $ (0.03) 0.28 0.66 0.79 ========== ========== ========== ========== Computation of Fully Diluted Earnings Per Common Share and Common Share Equivalent<F1> - --------------------------- Net income (loss) $ (144,527) 1,414,094 2,975,248 4,182,991 ---------- ---------- ---------- ---------- Weighted average number of common share and common share equivalents: Weighted average common shares outstanding 4,185,867 5,104,878 4,474,903 5,266,435 Dilutive effect of stock option plans after application of treasury stock method 51,718 41,596 51,718 ---------- ---------- ---------- ---------- 4,185,867 5,156,596 4,516,499 5,318,153 ---------- ---------- ---------- ---------- Earnings (loss) per common share and common share equivalents $ (0.03) 0.27 0.66 0.79 ========== ========== ========== ========== <FN> <F1> This calculation is submitted in accordance with Regulation S-K Item 601(b)(11) although not required by footnote 2 of paragraph 14 of APB Opinion No. 15 because it results in dilution of less than 3%. </FN>