6. Securities

The amortized cost and fair value of securities were as follows:



	September 30, 2013
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value
	(In Thousands)
Available for Sale:
U.S. Government agencies	$	28,259	$	5	$	(745)	$	27,519
States and political subdivisions		64,413		942		(1,561)		63,794
Corporate obligations		4,690		138		(74)		4,754
Mortgage-backed securities-
government sponsored entities		55,628		214		(1,348)		54,494
Equity securities-financial services		292		51		-		343
	$	153,282	$	1,350	$	(3,728)	$	150,904
Held to Maturity:
States and political subdivisions	$	174	$	2	$	-	$	176



	December 31, 2012
			Gross		Gross
	Amortized		Unrealized		Unrealized		Fair
	Cost		Gains		Losses		Value

	(In Thousands)
Available for Sale:
U.S. Government agencies	$	13,076	$	36	$	(20)	$	13,092
States and political subdivisions		55,864		2,995		(73)		58,786
Corporate obligations		8,521		347		-		8,868
Mortgage-backed securities-government
sponsored entities		63,397		1,041		(113)		64,325
Equity securities-financial services		292		27		-		319
	$	141,150	$	4,446	$	(206)	$	145,390
Held to Maturity:
States and political subdivisions	$	173	$	4	$	-	$	177

The following tables show the Company’s investments’ gross unrealized losses and fair value aggregated by length of time that individual securities have been in a continuous unrealized loss position (in thousands):



	September 30, 2013
	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. government agencies	$	25,401	$	(745)	$	-	$	-	$	25,401	$	(745)
States and political subdivisions		24,672		(1,550)		772		(11)		25,444		(1,561)
Corporate Obligations		2,505		(74)		-		-		2,505		(74)
Mortgage-backed securities-government sponsored agencies		33,903		(1,337)		820		(11)		34,723		(1,348)
	$	86,481	$	(3,706)	$	1,592	$	(22)	$	88,073	$	(3,728)



	December 31, 2012
	Less than 12 Months				12 Months or More				Total
	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
U.S. government agencies	$	7,056	$	(20)	$	-	$	-	$	7,056	$	(20)
States and political subdivisions		5,821		(73)		-		-		5,821		(73)
Mortgage-backed securities-government sponsored agencies		17,199		(113)		-		-		17,199		(113)
	$	30,076	$	(206)	$	-	$	-	$	30,076	$	(206)

At September 30, 2013, the Company has 107 debt securities in an unrealized loss position in the less than twelve months category and two debt securities in the twelve months or more category. In Management’s opinion the unrealized losses reflect changes in interest rates subsequent to the acquisition of specific securities. No other-than-temporary-impairment charges were recorded in 2013. Management believes that all unrealized losses represent temporary impairment of the securities as the Company does not have the intent to sell the securities and it is more likely than not that it will not have to sell the securities before recovery of its cost basis.

The amortized cost and fair value of debt securities as of September 30, 2013 by contractual maturity are shown below. Expected maturities may differ from contractual maturities because borrowers may have the right to prepay obligations with or without call or prepayment penalties.



	Available for Sale				Held to Maturity
	Amortized Cost		Fair Value		Amortized Cost		Fair Value
	(In Thousands)

Due in one year or less	$	2,418	$	2,436	$	174	$	176
Due after one year through five years		13,948		14,009		-		-
Due after five years through ten years		38,573		38,015		-		-
Due after ten years		42,423		41,607		-		-

Mortgage-backed securities-government sponsored agencies		55,628		54,494		-		-
	$	152,990	$	150,561	$	174	$	176

Gross realized gains and gross realized losses on sales of securities available for sale were as follows (in thousands):



	Three Months				Nine Months
	Ended September 30,				Ended September 30,
	2013		2012		2013		2012
Gross realized gains	$	198	$	631	$	608	$	1,318
Gross realized losses		-		-		(18)		-
Net realized gain	$	198	$	631	$	590	$	1,318
Proceeds from sales of securities	$	14,663	$	15,549	$	29,962	$	23,265