(4) Securities

Securities at December 31, 2012 consisted of the following:

		Gross	Gross	Estimated
	Amortized	Unrealized	Unrealized	Fair
(In thousands)	Cost	Gains	Losses	Value
Securities available-for-sale:
U.S. government sponsored enterprises	$14,771	$446	$74	$15,143
State and political subdivisions	3,770	56	-	3,826
Mortgage-backed securities-residential	10,070	360	-	10,430
Mortgage-backed securities-multi-family	43,268	671	1	43,938
Asset-backed securities	19	-	1	18
Corporate debt securities	4,042	452	-	4,494
Total debt securities	75,940	1,985	76	77,849
Equity and other securities	67	71	-	138
Total securities available-for-sale	76,007	2,056	76	77,987
Securities held-to-maturity:
U.S. treasury securities	7,014	40	-	7,054
U.S. government sponsored enterprises	2,999	25	5	3,019
State and political subdivisions	64,521	725	62	65,184
Mortgage-backed securities-residential	36,318	2,138	--	38,456
Mortgage-backed securities-multi-family	55,637	1,493	129	57,001
Other securities	960	1	2	959
Total securities held-to-maturity	167,449	4,422	198	171,673
Total securities	$243,456	$6,478	$274	$249,660

Securities at June 30, 2012 consisted of the following:

		Gross	Gross	Estimated
	Amortized	Unrealized	Unrealized	Fair
(In thousands)	Cost	Gains	Losses	Value
Securities available-for-sale:
U.S. government sponsored enterprises	$16,816	$582	$-	$17,398
State and political subdivisions	4,783	116	-	4,899
Mortgage-backed securities-residential	18,625	482	1	19,106
Mortgage-backed securities-multi-family	40,077	604	18	40,663
Asset-backed securities	20	-	1	19
Corporate debt securities	5,053	263	-	5,316
Total debt securities	85,374	2,047	20	87,401
Equity and other securities	67	60	-	127
Total securities available-for-sale	85,441	2,107	20	87,528
Securities held-to-maturity:
U.S. treasury securities	11,029	61	-	11,090
U.S. government sponsored enterprises	998	31	-	1,029
State and political subdivisions	62,212	556	99	62,669
Mortgage-backed securities-residential	48,101	2,282	4	50,379
Mortgage-backed securities-multi-family	23,673	952	6	24,619
Other securities	376	-	-	376
Total securities held-to-maturity	146,389	3,882	109	150,162
Total securities	$231,830	$5,989	$129	$237,690

The following table shows fair value and gross unrealized losses, aggregated by security category and length of time that individual securities have been in a continuous unrealized loss position, at December 31, 2012.


	Less Than 12 Months		More Than 12 Months		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
(In thousands)	Value	Losses	Value	Losses	Value	Losses
Securities available-for-sale:
U.S. government sponsored enterprises	$2,000	$74	$-	$-	$2,000	$74
Mortgage-backed securities-multifamily	1,071	1	-	-	1,071	1
Asset-backed securities	-	-	17	1	17	1
Total securities available-for-sale	3,071	75	17	1	3,088	76
Securities held-to-maturity:
U.S. government sponsored enterprises	1,995	5	-	-	1,995	5
State and political subdivisions	8,339	60	442	2	8,781	62
Mortgage-backed securities-multifamily	10,332	129	-	-	10,332	129
Other securities	291	2	-	-	291	2
Total securities held-to-maturity	20,957	196	442	2	21,399	198
Total securities	$24,028	$271	$459	$3	$24,487	$274


	Less Than 12 Months		More Than 12 Months		Total
	Fair	Unrealized	Fair	Unrealized	Fair	Unrealized
(In thousands)	Value	Losses	Value	Losses	Value	Losses
Securities available-for-sale:
Mortgage-backed securities-residential	$340	$1	$-	$-	$340	$1
Mortgage-backed securities-multi-family	8,837	18	-	-	8,837	18
Asset-backed securities	-	-	19	1	19	1
Total securities available-for-sale	9,177	19	19	1	9,196	20
Securities held-to-maturity:
State and political subdivisions	10,696	99	-	-	10,696	99
Mortgage-backed securities-residential	527	4	-	-	527	4
Mortgage-backed securities-multi-family	4,189	6	-	-	4,189	6
Total securities held-to-maturity	15,412	109	-	-	15,412	109
Total securities	$24,589	$128	$19	$1	$24,608	$129

At December 31, 2012, there were 7 securities which have been in a continuous unrealized loss position for more than 12 months and 38 securities in a continuous unrealized loss position of less than 12 months. When the fair value of a held to maturity or available for sale security is less than its amortized cost basis, an assessment is made as to whether other-than-temporary impairment ("OTTI") is present. The Company considers numerous factors when determining whether a potential OTTI exists and the period over which the debt security is expected to recover. The principal factors considered are (1) the length of time and the extent to which the fair value has been less than the amortized cost basis, (2) the financial condition of the issuer (and guarantor, if any) and adverse conditions specifically related to the security, industry or geographic area, (3) failure of the issuer of the security to make scheduled interest or principal payments, (4) any changes to the rating of the security by a rating agency, and (5) the presence of credit enhancements, if any, including the guarantee of the federal government or any of its agencies.

For debt securities, OTTI is considered to have occurred if (1) the Company intends to sell the security, (2) it is more likely than not the Company will be required to sell the security before recovery of its amortized cost basis, or (3) if the present value of expected cash flows is not sufficient to recover the entire amortized cost basis. In determining the present value of expected cash flows, the Company discounts the expected cash flows at the effective interest rate implicit in the security at the date of acquisition. In estimating cash flows expected to be collected, the Company uses available information with respect to security prepayment speeds, default rates and severity. In determining whether OTTI has occurred for equity securities, the Company considers the applicable factors described above and the intent and ability of the Company to retain its investment in the issuer for a period of time sufficient to allow for any anticipated recovery in fair value.

For debt securities, credit-related OTTI is recognized in income while noncredit related OTTI on securities not expected to be sold is recognized in other comprehensive income ("OCI"). Credit-related OTTI is measured as the difference between the present value of an impaired security's expected cash flows and its amortized cost basis. Noncredit-related OTTI is measured as the difference between the fair value of the security and its amortized cost less any credit-related losses recognized. For securities classified as held to maturity, the amount of OTTI recognized in OCI is accreted to the credit-adjusted expected cash flow amounts of the securities over future periods. For equity securities, the entire amount of OTTI is recognized in income. Management evaluated securities considering the factors as outlined above, and based on this evaluation the Company does not consider these investments to be other-than-temporarily impaired at December 31, 2012. Management believes that the reasons for the decline in fair value are due to interest rates and widening credit spreads at the end of the quarter.

During the three and six months ended December 31, 2012, a gain on sale of $10,000 was recognized on a security that was previously written off as an other-than-temporary impairment. During the six months ended December 31, 2011 the Company sold $759,000 of corporate debt securities within its available-for-sale portfolio at a gain of $11,000. There was no other-than-temporary impairment loss recognized during the three and six months ended December 31, 2012 and 2011.

The estimated fair values of debt securities at December 31, 2012, by contractual maturity are shown below. Expected maturities may differ from contractual maturities, because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

(in thousands)

Available for sale debt securities	Amortized Cost	Fair Value
Within one year	$5,245	$5,281
After one year through five years	12,169	12,772
After five years through ten years	5,169	5,410
After ten years	-	-
Total available for sale debt securities	22,583	23,463
Mortgage-backed and asset-backed securities	53,357	54,386
Equity securities	67	138
Total available for sale securities	76,007	77,987

Held to maturity debt securities
Within one year	17,627	17,678
After one year through five years	22,691	22,860
After five years through ten years	24,714	25,162
After ten years	10,462	10,516
Total held to maturity debt securities	75,494	76,216
Mortgage-backed	91,955	95,457
Total held to maturity securities	167,449	171,673

Total securities	$243,456	$249,660

As of December 31, 2012 and 2011, securities with an aggregate fair value of $204.9 million and $154.6 million were pledged as collateral for deposits in excess of FDIC insurance limits for various municipalities placing deposits with Greene County Commercial Bank. As of December 31, 2012 and 2001, securities with an aggregate fair value of $4.5 million and $6.3 million, respectively, were pledged as collateral for potential borrowings at the Federal Reserve Bank discount window. Greene County Bancorp, Inc. did not participate in any securities lending programs during the six months ended December 31, 2012 or 2011.

Federal Home Loan Bank Stock

Federal law requires a member institution of the Federal Home Loan Bank ("FHLB") system to hold stock of its district FHLB according to a predetermined formula. This stock is restricted in that it can only be sold to the FHLB or to another member institution, and all sales of FHLB stock must be at par. As a result of these restrictions, FHLB stock is carried at cost. FHLB stock is held as a long-term investment and its value is determined based on the ultimate recoverability of the par value. Impairment of this investment is evaluated quarterly and is a matter of judgment that reflects management's view of the FHLB's long-term performance, which includes factors such as the following: its operating performance; the severity and duration of declines in the fair value of its net assets related to its capital stock amount; its commitment to make payments required by law or regulation and the level of such payments in relation to its operating performance; the impact of legislative and regulatory changes on the FHLB, and accordingly, on the members of the FHLB; and its liquidity and funding position. After evaluating these considerations, Greene County Bancorp, Inc. concluded that the par value of its investment in FHLB stock will be recovered and, therefore, no other-than-temporary impairment charge was recorded during the periods ended December 31, 2012 or 2011.