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Note 14 - Derivative Financial Instruments
 6 Months Ended
Jun. 30, 2016
Notes to Financial Statements  
Derivative Instruments and Hedging Activities Disclosure [Text Block]
14.
DERIVATIVE FINANCIAL INSTRUMENTS
 
Derivatives Designated as Hedging Instruments
 
On April 1, 2016, FUSB entered into a forward interest rate swap contract on a variable rate FHLB advance (indexed to three-month LIBOR) with a total notional amount
of $10.0 million. The interest rate swap contract was designated as a derivative instrument in a cash flow hedge under
ASC Topic 815, Derivatives and Hedging,
with the objective of protecting the quarterly interest rate payments on the FHLB advance from the risk of variability of those payments resulting from changes in the three-month LIBOR interest rate throughout the seven-year period beginning on April 5, 2016 and ending on April 5, 2023. Under the swap which became effective on April 5, 2016, FUSB will pay a fixed interest rate of 1.46% and receive a variable interest rate based on three-month LIBOR on the total notional amount of $10.0 million, with quarterly net settlements.
 
No ineffectiveness related to the interest rate swap designated as a cash
flow hedge was recognized in the consolidated statements of operations for the three and six month periods ended June 30, 2016. The accumulated net after-tax loss related to the effective cash flow hedge included in accumulated other comprehensive income totaled $140 thousand as of June 30, 2016. Amounts reported in accumulated other comprehensive income related to this derivative are reclassified to other interest expense as interest payments are made on FUSB’s variable rate FHLB advance. During the next twelve months, FUSB estimates that $68 thousand will be reclassified as an increase to interest expense.
 
Derivatives Not Designated as Hedging Instruments
 
In 2014, FUSB entered into three separate interest rate cap agreements to mitigate risks assoc
iated with increases in interest rates on an aggregate notional amount of $40 million. The interest rate caps qualify as derivatives but were not designated as hedging instruments. Accordingly, changes in the fair value of the instruments are included in results of operations. Under the three agreements, the Company paid an up-front premium totaling approximately $126 thousand, and received the ability to receive cash flows if interest rates rose above a strike rate indexed to three-month LIBOR. The agreements have contractual terms that mature at various dates in 2017. As of June 30, 2016, the strike rate had not been achieved on any of the three agreements, and accordingly, the Company has received no cash flows associated with the agreements. Since inception of the agreements, on a quarterly basis, the Company has recorded the current fair value of the derivatives within other assets on the Company’s consolidated balance sheet, with changes in the fair value included in interest expense on the Company’s consolidated statements of operations. As of June 30, 2016, the fair value of each of the three derivative agreements was zero. During the six months ended June 30, 2016, approximately $3 thousand has been recognized as interest expense associated with the agreements.