Derivatives

12 Months Ended

Dec. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Note 21 – Derivatives

The Company utilizes interest rate swap agreements as part of its asset liability management strategy to help manage its interest rate risk position. The notional amount of the interest rate swap does not represent amounts exchanged by the parties. The amount exchanged is determined by reference to the notional amount and the other terms of the individual interest rate swap agreements.

Interest rate swaps were entered into on August 24, 2015, October 15, 2014 and December 30, 2014, each with a respective notional amount of $25.0 million and were designated as a cash flow hedge of a Federal Home Loan Bank advance. The swaps were determined to be fully effective during the period presented and therefore no amount of ineffectiveness has been included in net income. Therefore, the aggregate fair value of the swaps is recorded in other assets (liabilities) with changes in fair value recorded in other comprehensive income (loss). The amount included in accumulated other comprehensive income (loss) would be reclassified to current earnings should the hedges no longer be considered effective. The Company expects the hedges to remain fully effective during the remaining term of the swaps.

Summary information about the interest rate swap designated as a cash flow hedges as of year-end is as follows (dollars in thousands):

	December 31,		December 31,
	2015		2014
Notional amount	$	75,000	$	50,000
Weighted average pay rates		1.56%		1.58%
Weighted average receive rates		0.44%		0.24%
Weighted average maturity		3.8 years		4.4 years
Fair value	$	(131)	$	48

Interest expense recorded on these swaps transactions totaled approximately $763,500 and $60,000 during 2015 and 2014 and is reported as a component of interest expense on FHLB Advances. There are no related expenses for the years ended December 31, 2013.

Cash Flow Hedge

The following table presents the net gains (losses), recorded in accumulated other comprehensive income and the Consolidated Statements of Income relating to the cash flow derivative instruments for the year ended December 31:

	2015
	Amount of loss		Amount of loss		Amount of loss
	recognized		reclassified		recognized in other
	in OCI (Effective		from OCI to		Non-interest income
(in thousands)	Portion)		interest income		(Ineffective Portion)
Interest rate contracts	$	(179)	$	-	$	-
			2014
	Amount of loss		Amount of loss		Amount of loss
	recognized		reclassified		recognized in other
	in OCI (Effective		from OCI to		Non-interest income
(in thousands)	Portion)		interest income		(Ineffective Portion)
Interest rate contracts	$	48	$	-	$	-

The following table reflects the cash flow hedges included in the Consolidated Balance Sheets as of December 31, 2015 and December 31, 2014:

	2015				2014
	Notional				Notional
(in thousands)	Amount		Fair Value		Amount		Fair Value
Included in other assets/(liabilities):
Interest rate swaps related to FHLB Advances	$	75,000	$	(131)	$	50,000	$	48

There were no net gains (losses) recorded in accumulated other comprehensive income or in the Consolidated Statement of Income relating to cash flow derivative instruments for the years ended December 21, 2015 and December 31, 2014.