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NOTE 2 <br />CITY OF GEM LAKE, MINNESOTA <br />NOTES TO BASIC FINANCIAL STATEMENTS.. <br />❑ECEMBER 31, 2016 <br />❑EPOSITS. AND INVESTMENTS (CONTINUED) <br />B. Investments (Continued) <br />Interest. Rafe Risk <br />Interest rate. risk is the risk that changes in interest rates. will adversely affect. the fair <br />value of an investment. Generally, the longer the maturity of an investment,. the greater <br />the. sensitivity of its fair. value. to changes in market interest .rates.. The City's investment <br />policy doesn't:specifically address interest rate risk. Information about the sensitivty of <br />the fair values of the. City's investments .to marked, ntetesf rate risk flut;tuations is <br />provided by the following table that shows the distribution ;_of. the City's investments by <br />maturity: <br />Matuii �u —ri in Years <br />investment TXpe. Total iess;Than i 1 to 2 2.to 5 5 to 10 Rating <br />Negotiable Certificates of Deposit: 5 354;000 : ' $:""100 000. 5 21.4.000 '$:.." =::A0,000 S Not Rated <br />Money Markets 3,087 3,087 Aaa1AAA <br />& 357,087:' $ 103,087 5 214,000. $ `41000 $ - <br />Credit Risk <br />Generally, credit risk is the risk that an issuer'af an investment will not fulfill its.obligation <br />to the holder of the investmo t: This is measured by the assignment of a rating by a <br />nationally recognized statistical rat ng,:organizatioOhe: City's investment policy doesn't <br />specifically address. credit risk The. fo lowing. charE summarizes year-end. ratings for the <br />City's investments as rated by Moody's. Investors5,erv"ices: <br />Government: <br />Negotiable-,'d <br />Goldman 5� <br />Capital One <br />Typo <br />tney Market[ <br />Ba <br />it <br />Credit <br />Quality Rating Amount <br />$ 3,087 <br />140, 00.0 <br />214,000 <br />354, 000 <br />$ 851,087 <br />(23) <br />