Note 5 - Securities

9 Months Ended

Sep. 30, 2015

Investments, Debt and Equity Securities [Abstract]

Investments in Debt and Marketable Equity Securities (and Certain Trading Assets) Disclosure [Text Block]

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.

	September 30, 2015
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Available for Sale:
U.S. Government agencies and corporations	$	190,723	$	757	$	4,557	$	186,923
States and political subdivisions		16,348		601		---		16,949
Mortgage-backed securities		1,355		137		---		1,492
Corporate debt securities		6,015		17		300		5,732
Other securities		189		---		53		136
Total securities available for sale	$	214,630	$	1,512	$	4,910	$	211,232

	December 31, 2014
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Available for Sale:
U.S. Government agencies and corporations	$	197,740	$	973	$	4,494	$	194,219
States and political subdivisions		18,529		851		---		19,380
Mortgage-backed securities		1,830		184		---		2,014
Corporate debt securities		6,991		140		27		7,104
Other securities		189		---		62		127
Total securities available for sale	$	225,279	$	2,148	$	4,583	$	222,844

The amortized cost and fair value of single maturity securities available for sale at September 30, 2015, 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.

	September 30, 2015
	Amortized Cost		Fair Value
Available for Sale:
Due in one year or less	$	338	$	339
Due after one year through five years		37,130		37,470
Due after give years through ten years		27,571		27,537
Due after ten years		149,402		145,750
No maturity		189		136
Total securities available for sale	$	214,630	$	211,232

The Company holds restricted stock with the Federal Home Loan Bank and the Federal Reserve. Required ownership amounts are determined by the correspondent banks and the Company purchases stock from or sells stock back to the correspondents based on their calculations. The stock is held by member institutions only and is not actively traded. The Company held restricted stock of $1,129 as of September 30, 2015 and $1,089 as of December 31, 2014.

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

	September 30, 2015
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Held to Maturity:
U.S. Government agencies and corporations	$	14,912	$	343	$	216	$	15,039
States and political subdivisions		137,969		5,635		1,020		142,584
Mortgage-backed securities		346		40		---		386
Corporate debt securities		1,417		18		1		1,434
Total securities held to maturity	$	154,644	$	6,036	$	1,237	$	159,443

	December 31, 2014
	Amortized Costs		Gross Unrealized Gains		Gross Unrealized Losses		Fair Values
Held to Maturity:
U.S. Government agencies and corporations	$	18,922	$	350	$	245	$	19,027
States and political subdivisions		140,702		6,823		727		146,798
Mortgage-backed securities		415		51		---		466
Corporate debt securities		1,413		1		2		1,412
Total securities held to maturity	$	161,452	$	7,225	$	974	$	167,703

The amortized cost and fair value of single maturity securities held to maturity at September 30, 2015, 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.

	September 30, 2015
	Amortized Cost		Fair Value
Held to maturity:
Due in one year or less	$	901	$	909
Due after one year through five years		12,890		13,781
Due after give years through ten years		20,165		21,185
Due after ten years		120,688		123,568
Total securities held to maturity	$	154,644	$	159,443

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.

	September 30, 2015
	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	$	62,563	$	1,358	$	89,871	$	3,415
States and political subdivisions		19,803		415		9,774		605
Corporate debt securities		4,968		300		200		1
Other securities		---		---		136		53
Total	$	87,334	$	2,073	$	99,981	$	4,074

	December 31, 2014
	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	$	6,964	$	30	$	156,149	$	4,709
States and political subdivisions		1,222		35		19,818		692
Corporate debt securities		450		2		1,948		27
Other securities		---		---		127		62
Total	$	8,636	$	67	$	178,042	$	5,490

The Company had 210 securities with a fair value of $187,315 that were temporarily impaired at September 30, 2015.  The total unrealized loss on these securities was $6,147. Of the temporarily impaired total, 110 securities with a fair value of $99,981 and an unrealized loss of $4,074 have been in a continuous loss position for twelve months or more. The Company has determined that these securities are temporarily impaired at September 30, 2015 for the reasons set out below.

U.S. Government agencies. The unrealized losses of $4,773 on US Government agency securities stemmed from 157 securities with a fair value of $152,434. The unrealized losses 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. The Company is monitoring bond market trends and developing strategies to address unrealized losses. 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.

States and political subdivisions. This category’s unrealized losses of $1,020 on 45 securities with a fair value of $29,577 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. The Company’s unrealized losses of $301 on 7 corporate debt securities with a fair value of $5,168 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 securities. The Company holds a small investment in community bank stock. One security with a fair value of $136 has an unrealized loss of $53. The value of this investment has been negatively affected by market conditions. Because the Company does not intend to sell this investment before recovery of its amortized cost basis, the Company does not consider this investment to be other-than-temporarily impaired.

Restricted stock. Restricted stock is reported separately from available-for-sale securities and held-to-maturity securities. 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 September 30, 2015, management did not determine 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 monitor any changes in bond quality.