Note 6 - Related Party Transactions

3 Months Ended

Mar. 31, 2019

Notes to Financial Statements

Related Party Transactions Disclosure [Text Block]

Note

6

.  Related Party Transactions

In conducting its business, FNCB has engaged in, and intends to continue to engage in, banking and financial transactions with directors, executive officers and their related parties.

FNCB has granted loans, letters of credit and lines of credit to directors, executive officers and their related parties. The following table summarizes the changes in the total amounts of such outstanding loans, advances under lines of credit, net of any participations sold, as well as repayments during the

three

months ended

March 31, 2019 

and

2018.

	For the Three Months Ended March 31,
(in thousands)	2019			2018
Balance January 1,	$	64,634		$	55,576
Additions, new loans and advances		17,089			31,169
Repayments		(9,573	)		(20,861	)
Balance March 31,	$	72,150		$	65,884

At

March 31, 2019,

there were

no

loans made to directors, executive officers and their related parties that were

not

performing in accordance with the terms of the loan agreements.

Deposits from directors, executive officers and their related parties held by the Bank at

March 31, 2019 

and

December 

31,

2018

 amounted to

$92.4

 million and

$115.5

million, respectively, a decrease of

$23.1

million. The decrease was due to cyclical outflows from several large commercial deposit relationships that are owned by, or a related party to, certain directors. Interest paid on the deposits amounted to

$119

 thousand and

$84

thousand for the

three

months ended on

March 31, 2019 

and

2018,

respectively.

In the course of its operations, FNCB acquires goods and services from, and transacts business with, various companies of related parties, which include, but are

not

limited to, employee health insurance, fidelity bond and errors and omissions insurance, legal services, and repair of repossessed automobiles for resale. FNCB recorded payments to related parties for goods and services of

$528

thousand and

$553

 thousand for the

three

months ended

March 31, 2019 

and

2018,

respectively.

On

February 8, 2019,

FNCB accelerated the final

$5.0

million principal repayment, which was due and payable on

September 1, 2019,

along with all accrued interest, of which

$3.1

million was paid to directors and/or their related interests.  Subordinated notes (the “Notes”) held by directors and/or their related parties totaled

$3.1

million at

December 

31,

2018.

Interest expense recorded on the Notes for directors and/or their related parties amounted to

$27

thousand and

$35

thousand for the

three

months ended March

31,

2019

and

2018,

respectively. 

On

January 28, 2019,

FNCB commenced a public offering of shares of its common stock in a firm commitment underwritten offering. The offering closed on

February 8, 2019

and FNCB issued

3,285,550

shares of its common stock at an offering price of

$7.00

per share. Shares acquired by directors, executive officers and their related parties as part of this offering were

339,886,

or

10.3%,

of the total common shares issued. For more information about the public offering, refer to Note

9

, “Regulatory Matters/Subsequent Event” to these consolidated financial statements.