The amortized costs, gross unrealized gains, gross unrealized losses and fair values for securities available for sale by major security type as of June 30, 2011 are as follows:

	June 30, 2011
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Available for sale:
U.S. Treasury	$	2,012	$	168	$	---	$	2,180
U.S. Government agencies		103,012		1,070		803		103,279
Mortgage-backed securities		8,848		622		---		9,470
States and political subdivisions		52,332		1,686		145		53,873
Corporate		16,877		699		14		17,562
Federal Home Loan Bank stock		1,626		---		---		1,626
Federal Reserve Bank stock		92		---		---		92
Other securities		2,719		35		162		2,592
Total	$	187,518	$	4,280	$	1,124	$	190,674

The amortized costs, gross unrealized gains, gross unrealized losses and fair values for securities held to maturity by major security type as of June 30, 2011 are as follows:

	June 30, 2011
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Held to maturity:
U.S. Government agencies	$	18,056	$	465	$	63	$	18,458
Mortgage-backed securities		1,015		98		---		1,113
States and political subdivisions		114,670		3,616		265		118,021
Corporate		2,658		32		---		2,690
Total	$	136,399	$	4,211	$	328	$	140,282

Information pertaining to securities with gross unrealized losses at June 30, 2011 and December 31, 2010, aggregated by investment category and length of time that individual securities have been in a continuous loss position, follows:

	June 30, 2011
	Less Than 12 Months				12 Months or More
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Temporarily impaired securities:
U.S. Government agencies	$	43,104	$	866	$	---	$	---
States and political subdivisions		17,698		320		2,697		90
Corporate		1,986		14		---		---
Other securities		---		---		142		162
Total	$	62,788	$	1,200	$	2,839	$	252

	December 31, 2010
	Less Than 12 Months				12 Months or More
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Temporarily impaired securities:
U.S. Government agencies	$	64,850	$	3,127	$	---	$	---
States and political subdivisions		65,640		2,605		2,528		258
Corporate		969		31		---		---
Other securities		---		---		247		246
Total	$	131,459	$	5,763	$	2,775	$	504

The Company had 74 securities with a fair value of $65,627 which were temporarily impaired at June 30, 2011. The total unrealized loss on these securities was $1,452. Of the temporarily impaired total, five securities with a fair value of $2,839 and an unrealized loss of $252 have been in a continuous loss position for twelve months or more. The Company has determined that these securities are temporarily impaired at June 30, 2011 for the reasons set out below.

U.S. Government agencies. The unrealized losses in this category of investments were caused by interest rate and market fluctuations. The contractual terms of the investments do not permit the issuer to settle the securities at a price less than the cost basis of each investment. Because the Company does not intend to sell any of the investments and it is not likely that the Company will be required to sell any of these investments before recovery of its amortized cost basis, which may be at maturity, the Company does not consider these investments to be other-than-temporarily impaired.

States and political subdivisions. This category’s unrealized losses are primarily the result of interest rate and market fluctuations and also a certain few ratings downgrades brought about by the impact of the economic downturn on states and political subdivisions. The contractual terms of the investments do not permit the issuer to settle the securities at a price less than the cost basis of each investment. Because the Company does not intend to sell any of the investments and it is not likely that the Company will be required to sell any of the investments before recovery of its amortized cost basis, which may be at maturity, the Company does not consider these investments to be other-than-temporarily impaired.

Corporate debt securities. The Company’s unrealized losses in corporate debt securities are related to interest rate and market fluctuations and to ratings downgrades for a limited number of securities. The contractual terms of the investments do not permit the issuer to settle the securities at a price less than the cost basis of each investment. Because the Company does not intend to sell any of the investments before recovery of its amortized cost basis, which may be at maturity, the Company does not consider these investments to be other-than-temporarily impaired.

Other. The Company holds an investment in an LLC and a small amount of community bank stock. The value of these investments has been negatively affected by market conditions. Because the Company does not intend to sell these investments before recovery of amortized cost basis, the Company does not consider these investments to be other-than-temporarily impaired.

As a member of the Federal Reserve and the Federal Home Loan Bank (“FHLB”) of Atlanta, NBB is required to maintain certain minimum investments in the common stock of those entities. Required levels of investment are based upon NBB’s capital and a percentage of qualifying assets. In addition, NBB is eligible to borrow from the FHLB with borrowings collateralized by qualifying assets, primarily residential mortgage loans and NBB’s capital stock investment in the FHLB. Redemption of FHLB stock is subject to certain limitations and conditions. At its discretion, the FHLB may declare dividends on the stock. Management reviews for impairment based upon the ultimate recoverability of the cost basis of the FHLB stock, and at March 31, 2011, management did not consider there to be any impairment.

Management regularly monitors the credit quality of the investment portfolio. Changes in ratings are noted and follow-up research on the issuer is undertaken when warranted. Management intends to carefully follow any changes in bond quality. Refer to “Securities” in this report for additional information.