Note 5: Securities

The amortized costs, gross unrealized gains, gross unrealized losses and fair values for securities available for sale by major security type are as follows.

	March 31, 2013
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Available for Sale:
U.S. Treasury	$	2,003	$	50	$	---	$	2,053
U.S. Government agencies		137,851		976		1,189		137,638
Mortgage-backed securities		3,739		333		---		4,072
States and political subdivisions		32,082		1,505		4		33,583
Corporate		11,809		178		52		11,935
Other securities		2,393		---		134		2,259
Total	$	189,877	$	3,042	$	1,379	$	191,540

	December 31, 2012
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Available for Sale:
U.S. Treasury	$	2,005	$	68	$	---	$	2,073
U.S. Government agencies		128,805		1,381		622		129,564
Mortgage-backed securities		4,202		367		---		4,569
States and political subdivisions		35,029		1,753		3		36,779
Corporate		14,207		368		---		14,575
Other securities		2,419		9		173		2,255
Total	$	186,667	$	3,946	$	798	$	189,815

The amortized costs, gross unrealized gains, gross unrealized losses and fair values for securities held to maturity by major security type are as follows.

	March 31, 2013
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Held to Maturity:
U.S. Government agencies	$	13,985	$	507	$	33	$	14,459
Mortgage-backed securities		644		72		---		716
States and political subdivisions		151,668		7,851		1,127		158,392
Corporate		650		1		---		651
Total	$	166,947	$	8,431	$	1,160	$	174,218

	December 31, 2012
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Held to Maturity:
U.S. Government agencies	$	7,988	$	563	$	---	$	8,551
Mortgage-backed securities		691		73		---		764
States and political subdivisions		151,209		9,880		216		160,873
Corporate		651		7		---		658
Total	$	160,539	$	10,523	$	216	$	170,846

Information pertaining to securities with gross unrealized losses aggregated by investment category and length of time that individual securities have been in a continuous loss position, follows.

	March 31, 2013
	Less Than 12 Months				12 Months or More
	Fair Value		Unrealized Loss		Fair Value		Unrealized Loss
Temporarily Impaired Securities:
U.S. Government agencies and corporations	$	85,100	$	1,222	$	---	$	---
States and political subdivisions		28,178		1,127		481		4
Corporate debt securities		3,974		52		---		---
Other		---		---		360		134
Total	$	117,252	$	2,401	$	841	$	138

	December 31, 2012
	Less Than 12 Months						12 Months or More
	Fair Value			Unrealized Loss			Fair Value			Unrealized Loss
Temporarily Impaired Securities:
U.S. Government agencies and corporations		$	44,351		$	622		$	---		$	---
States and political subdivisions			9,358			216			482			3
Other			---			---			133			172
Total		$	53,709		$	838		$	615		$	175

The Company had 137 securities with a fair value of $118,093 which were temporarily impaired at March 31, 2013. The total unrealized loss on these securities was $2,539. Of the temporarily impaired total, four securities with a fair value of $841 and an unrealized loss of $137 have been in a continuous loss position for twelve months or more. The Company has determined that these securities are temporarily impaired at March 31, 2013 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. 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. 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, 2013, 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.