	December 31, 2011
Available for sale:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury	$	2,010	$	140	$	---	$	2,150
U.S. Government agencies and corporations		94,716		1,307		20		96,003
States and political subdivisions		47,118		2,034		30		49,122
Mortgage-backed securities		7,156		569		---		7,725
Corporate debt securities		15,852		322		97		16,077
Federal Home Loan Bank stock – restricted		1,574		---		---		1,574
Federal Reserve Bank stock – restricted		92		---		---		92
Other securities		2,330		7		162		2,175
Total securities available for sale	$	170,848	$	4,379	$	309	$	174,918

	December 31, 2010
Available for sale:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Treasury	$	2,015	$	168	$	---	$	2,183
U.S. Government agencies and corporations		90,641		424		2,913		88,152
States and political subdivisions		60,676		1,417		411		61,682
Mortgage-backed securities		10,744		635		---		11,379
Corporate debt securities		16,902		778		---		17,680
Federal Home Loan Bank stock – restricted		1,677		---		---		1,677
Federal Reserve Bank stock – restricted		92		---		---		92
Other securities		2,308		---		246		2,062
Total securities available for sale	$	185,055	$	3,422	$	3,570	$	184,907

The amortized cost and fair value of single maturity securities available for sale at December 31, 2011, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Mortgage-backed securities included in these totals are categorized by final maturity at December 31, 2011.

	December 31, 2011
	Amortized Cost		Fair Value
Due in one year or less	$	12,986	$	13,178
Due after one year through five years		37,091		38,196
Due after five years through ten years		19,896		21,033
Due after ten years		97,443		99,234
No maturity		3,432		3,277
	$	170,848	$	174,918

	December 31, 2011
Held to maturity:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Government agencies and corporations	$	22,057	$	562	$	---	$	22,619
States and political subdivisions		119,381		6,775		15		126,141
Mortgage-backed securities		902		94		---		996
Corporate debt securities		1,655		18		---		1,673
Total securities held to maturity	$	143,995	$	7,449	$	15	$	151,429

	December 31, 2010
Held to maturity:	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses		Fair Value
U.S. Government agencies and corporations	$	13,074	$	310	$	214	$	13,170
States and political subdivisions		112,625		1,174		2,452		111,347
Mortgage-backed securities		1,142		97		---		1,239
Corporate debt securities		4,159		29		31		4,157
Total securities held to maturity	$	131,000	$	1,610	$	2,697	$	129,913

The amortized cost and fair value of single maturity securities held to maturity at December 31, 2011, by contractual maturity, are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to call or prepay obligations with or without call or prepayment penalties. Mortgage-backed securities included in these totals are categorized by final maturity at December 31, 2011.

	December 31, 2011
	Amortized Cost		Fair Value
Due in one year or less	$	5,814	$	5,915
Due after one year through five years		11,760		12,204
Due after five years through ten years		14,153		15,126
Due after ten years		112,268		118,184
	$	143,995	$	151,429

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

	December 31, 2011
	Less Than 12 Months					12 Months or More
	Fair Value			Unrealized Loss		Fair Value			Unrealized Loss
U. S. Government agencies and corporations		$	6,230	$	20		$	---	$	---
State and political subdivisions			3,527		19			981		26
Corporate debt securities			4,916		97			---		---
Other			---		---			142		162
Total temporarily impaired securities		$	14,673	$	136		$	1,123	$	188

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

At December 31, 2011, the Company had 19 securities with a fair value of $15,796 which had total unrealized losses of $324. The Company has made the determination that these securities are temporarily impaired at December 31, 2011 for the following reasons:

U.S. Government agencies and corporations. The unrealized losses in this category of investments were caused by interest rate 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 the accounting standard of “more likely than not” has not been met for the Company to be required to sell any of these investments before recovery of its amortized cost basis, which may be maturity, the Company does not consider these investments to be other-than-temporarily impaired.

State and political subdivisions. This category’s unrealized losses are primarily the result of interest rate 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 the accounting standard of “more likely than not” has not been met for the Company to be required to sell any of the investments before recovery of its amortized cost basis, which may be 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 both interest rate fluctuations and 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 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.

At December 31, 2010, the Company had 166 securities with a fair value of $134,234 which were temporarily impaired. The total unrealized loss on these securities, which was attributed to interest rate fluctuations, was $6,267. Because the Company had the ability and intent to hold the securities until maturity or until the cost was recovered, the losses associated with the securities were not considered other than temporary at December 31, 2010.

At December 31, 2011 and 2010, securities with a carrying value of $147,152 and $141,810, respectively, were pledged to secure trust deposits and for other purposes as required or permitted by law.

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 totaling approximately $124,630, 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 in the FHLB stock.