Our efforts to mitigate interest rate risk are a combination of state-of-the-art modeling and old-fashioned common sense.

Thanks to our friends at ALM First, we have the benefit of a full array of highly sophisticated modeling tools, which help us understand the degree of risk that exists within our balance sheet. These same tools help us predict how those risks might change under varying strategies and changes in market interest rates.

While these modeling tools are extremely valuable, we also realize that the real world doesn't always behave exactly as the models may predict. For example, the challenging and uncertain economic conditions here in Nevada tell us that high levels of liquidity and flexibility in our balance sheet are well advised. Also, the relatively flat yield curve (at least in the shorter maturities) and record low levels of market interest rates strongly argue against lengthening loan and investment maturities.