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CITY OF GEM LAKE, MINNESOTA NOTES TO BASIC FINANCIAL STATEMENTS DECEMBER 31, 2014 NOTE 2 DEPOSITS AND .INVESTMENTS (CONTINUED) B. Investments (Continued) Interest Rate Risk lnterest rate risk is the risk that changes in interest rates. Will adversely affect the fair value of an investment. Generally, the longer the maturity of an investment, the greater the sensitivity of its fair value. to changes in market. interest rates. The City's. investment policy doesn't specifically address interest rate risk. Information about the sensitivty of the fair values of the City's investments to market interest. rate risk fluctuations is provided by the fallowing table that shows the distribution of the City's investments by maturity..: 12 Months 1.3 to 24 25 to 60 More than Type Total or Less Months Months 60 Months Build America Bonds - Shoreview 5 150,224 $ - 3 - $. 5 150,22.4 Negotiable Certificates of Deposit 385,726 246.16D 100,117 40,450 Wells Fargo Prime Investment. Fund 180,622 180,622 - - - Total S 717,571 5 160,622 S 246,16D $ 100,117 5 190.573 Credit Risk Generally, credit risk is the risk that an issuer of an investment will not fulfill its obligation to the holder of the investment. This is measured by the assignment of a rating by a nationally recognized statistical rating, organization. The City's investment policy doesn't specifically address credit risk. The following chart summarizes year-end ratings for the City's investments as rated by. Moody's investors Services: Tvr)e: Government Money Market Mutual Funds Buifd America Bonds - Shoreview Negotiable..Certificates of Deposit: GE Capital Bank CD Goldman Sachs Bank CD Total Negotiable Certificates of Depos►ts Total NR w Not Rated (25) Credit Quality Rating Amount NR� $ 180,622 AAA 150.224 NR.. 246,160 NR 140,666 386;726. $ 717,571