If he were that kind of hands-on manager, this mess might not have happened in the first place.
The real risk-free rate is 4%. 1. The real risk-free rate is 4%. Inflation is expected to be 3% this year and 5% during the next 2 years. Assume that the maturity risk premium is zero.
Interest rate risk (IRR) is defined as the potential for changing market interest rates to adversely affect a bank's earnings or capital protection. Two previous issues of Community Banking Connections included articles on IRR management for community banks.