--- title: Plansmith Blog | interest rate risk description: interest rate risk | --- [CALL TOLL-FREE 1-800-323-3281](https://www.plansmith.reachproductions.net/project/call-toll-free-1-800-323-3281/) [![Plansmith](https://blog.plansmith.com/hs-fs/hubfs/Plansmith-Logo.png?width=764&height=135&name=Plansmith-Logo.png "Plansmith")](https://www4.plansmith.com) - Solutions - [Budgeting](https://www4.plansmith.com/budgeting/) - [ALM](https://www4.plansmith.com/alm) - [ALM Advisory Services](https://www4.plansmith.com/alm/advisory-services/) - [CECL](https://www4.plansmith.com/cecl/) - [Strategy](https://www4.plansmith.com/strategy/) - [Market Intelligence](https://www4.plansmith.com/market-intelligence/) - Products - [StrategyGPS](https://www4.plansmith.com/strategygps/) - [Compass](https://www4.plansmith.com/compass/) - [BankersGPS](https://www4.plansmith.com/bankersgps/) - Resources - [Blog](https://blog.plansmith.com/) - [Videos](https://plansmith.wistia.com/projects/7qemazkqii) - [Compass Tutorials](https://info.plansmith.com/compass-tutorials) - [Lunch N’ Learn](https://info.plansmith.com/lunch-n-learns) - [Webinars](https://www4.plansmith.com/webinars/) - [About](https://www4.plansmith.com/about/) - [Schedule A Discovery Call](https://www4.plansmith.com/contact-us/) - [CALL TOLL-FREE 1-800-323-3281](tel:8003233281) # Plansmith Blog ## [Introducing the Plansmith Forum: 2026 Inaugural Event Recap](https://blog.plansmith.com/introducing-the-plansmith-forum-2026-inaugural-event-recap) Posted by [Jennifer Mello](https://blog.plansmith.com/author/jennifer-mello) on 5/22/26, 9:15 AM - [Tweet](https://twitter.com/share) [![](https://blog.plansmith.com/hubfs/Plansmith%20Forum%202026.png)](https://blog.plansmith.com/introducing-the-plansmith-forum-2026-inaugural-event-recap) I'm thrilled to share a recap of last week’s first-ever Plansmith Forum, which was an incredible success! **Attendance & Experience** We welcomed 21 attendees representing a wide range of leadership and management roles from financial institutions across the country. Hosted at the Renaissance Hotel near our corporate offices in Schaumburg, IL, the event delivered two full days of learning, collaboration, networking, and social engagement with the Plansmith team — and, most importantly, with industry peers. *“Can’t stress enough the importance of talking with other Compass users.”* *“Wonderful event for new and experienced users!”* [Read More](https://blog.plansmith.com/introducing-the-plansmith-forum-2026-inaugural-event-recap) ## [Ask AI: Is RiskGPS a Good Choice for YOUR Institution?](https://blog.plansmith.com/ask-ai-is-riskgps-a-good-choice-for-your-institution) Posted by [Jenny Kane](https://blog.plansmith.com/author/jenny-kane) on 9/5/25, 10:11 AM - [Tweet](https://twitter.com/share) [![](https://blog.plansmith.com/hubfs/AI-RiskGPS.png)](https://blog.plansmith.com/ask-ai-is-riskgps-a-good-choice-for-your-institution) AI is transforming the way we work, and, at Plansmith, we're excited to be part of the movement. In August 2025, we proudlylaunched our latest innovation, RiskGPS AI Assist, available in our BankersGPS model. Since then, we've received thoughtful questions from clients exploring the new feature. One in particular stood out, and we couldn't resist sharing it with you. [Read More](https://blog.plansmith.com/ask-ai-is-riskgps-a-good-choice-for-your-institution) ## [Margin Risk Tolerance: How Much Risk Can Your Financial Institution Afford?](https://blog.plansmith.com/margin-risk-tolerance-how-much-risk-can-your-financial-institution-afford) Posted by [Bill Smith](https://blog.plansmith.com/author/bill-smith) on 4/4/25, 9:14 AM - [Tweet](https://twitter.com/share) [![margin-risk-tolerance](https://blog.plansmith.com/hubfs/Postcard%203.05.2024.jpg)](https://blog.plansmith.com/margin-risk-tolerance-how-much-risk-can-your-financial-institution-afford) Risk is inevitable in banking; in fact, it’s what makes banking profitable. The question is, how much risk is acceptable? Recognizing that existing techniques of measurement were sometimes misleading and arbitrary, Plansmith developed a simple calculation called "Margin Risk Tolerance" that defines how much risk each bank can take. Despite the wealth of banking information Plansmith has at hand, we believe risk relates to the individual bank, and cannot be measured to any peer standard or magic number. Margin risk tolerance calculates the minimum net interest income and net interest margin necessary to maintain continuing operations. Minimum margin consists of two basic components: 1) earnings needed to maintain an acceptable capital ratio and pay dividends, and 2) earnings needed for overhead. [Read More](https://blog.plansmith.com/margin-risk-tolerance-how-much-risk-can-your-financial-institution-afford) ## [Surge Deposits: Straight Up with a Twist](https://blog.plansmith.com/surge-deposits-straight-up-with-a-twist) Posted by [Dave Wicklund](https://blog.plansmith.com/author/dave-wicklund) on 11/1/23, 10:59 AM - [Tweet](https://twitter.com/share) [![surge_deposits](https://blog.plansmith.com/hubfs/Budgeting%20Postcard%20Bleed%202023.10.05.png)](https://blog.plansmith.com/surge-deposits-straight-up-with-a-twist) For the past few years, I’ve written about the varying circumstances surrounding Surge Deposits. From “the death of” to the “resurgence,” it seems to be a consistently hot topic – this year, with a slight twist. While previously keeping a close watch on the influx of demand deposits, we’re now seeing increased pressure on funding flowing either from non-maturity deposits (NMDs) into higher costing CDs, or out of financial institutions all together.  Before we get further, if you haven’t yet read my other blogs discussing Surge Deposits, or could use a refresher, [click here](https://blog.plansmith.com/topic/surge-deposits) to do so. [Read More](https://blog.plansmith.com/surge-deposits-straight-up-with-a-twist) ## [Asset Liability Management and the Link to Bank Failures](https://blog.plansmith.com/asset-liability-management-and-the-link-to-bank-failures) Posted by [Dave Wicklund](https://blog.plansmith.com/author/dave-wicklund) on 4/5/23, 1:13 PM - [Tweet](https://twitter.com/share) [![alm and bank failure](https://blog.plansmith.com/hubfs/Liquidity%20Postcard%20Bleed%202023.02.jpg)](https://blog.plansmith.com/asset-liability-management-and-the-link-to-bank-failures) It was only two months ago we released a [blog](https://blog.plansmith.com/liquidity-read-all-about-it) discussing the critical role that liquidity management will play in 2023. Fast forward to now, and two financial institutions have been closed due to, at least in part, funding imbalances – the first banks in three years to fail. Although liquidity and interest rate risk often take a backseat under stable economic conditions, times like these require you to take an in-depth look into your asset liability management program to ensure you have a plan to both meet funding needs and stay in compliance with regulatory expectations. [Read More](https://blog.plansmith.com/asset-liability-management-and-the-link-to-bank-failures) ## [Help! The Rates Ate My Budget](https://blog.plansmith.com/help-the-rates-ate-my-budget) Posted by [Sue West](https://blog.plansmith.com/author/sue-west) on 4/25/22, 10:58 AM - [Tweet](https://twitter.com/share) [![rates-ate-my-budget](https://blog.plansmith.com/hubfs/ALMIRR%20PostcardBleed2022.04.4%20(2).png)](https://blog.plansmith.com/help-the-rates-ate-my-budget) Planning in a Rising Rate Environment….didn’t see this coming? We all knew that rates would be on the rise in 2022; it’s a normal reaction in an inflationary economy. But how many of us were able to predict when, how much, and how often those changes would occur? Not to worry, one of the greatest advantages of a full simulation model is its ability to adapt! Managing your current plan should be no big deal as your Plansmith system uses dynamic models and a monthly RateForecast download to keep your plan current. This is truly where our products perform because of their ability to provide management with balance sheet, income statement, and yield/cost information that is current and reprojects the anticipated outcome at year end. [Read More](https://blog.plansmith.com/help-the-rates-ate-my-budget) ## [The Outsourcing Dilemma: Time, Cost, and Control](https://blog.plansmith.com/is-irr-and-liquidity-cash-flow-model-outsourcing-right-for-you) Posted by [Dave Wicklund](https://blog.plansmith.com/author/dave-wicklund) on 12/1/20, 10:58 AM - [Tweet](https://twitter.com/share) [![irroutsourcing](https://blog.plansmith.com/hubfs/money-2696229_1920%20(1).jpg)](https://blog.plansmith.com/is-irr-and-liquidity-cash-flow-model-outsourcing-right-for-you) Is IRR and Liquidity Cash Flow Model Outsourcing Right for You? That is a question a lot of CFOs and Presidents struggle with. Here at Plansmith, it really doesn’t matter to us whether you run the model yourself, or you outsource it to us. In fact, we have many clients on both sides of that fence, and even some that do a little of each. We just want you to be comfortable with whichever option you choose, be confident in your model results, and be sure your ALM process will pass the test at regulatory exams. [Read More](https://blog.plansmith.com/is-irr-and-liquidity-cash-flow-model-outsourcing-right-for-you) ## [NEW! Client Spotlight Episode 1: Richwood Bank](https://blog.plansmith.com/new-client-spotlight-episode-1-richwood-bank) Posted by [David Schwieder](https://blog.plansmith.com/author/david-schwieder) on 10/21/20, 10:05 AM - [Tweet](https://twitter.com/share) [![](https://blog.plansmith.com/hubfs/light-300431_1920.jpg)](https://blog.plansmith.com/new-client-spotlight-episode-1-richwood-bank) We have some exciting news! Our first installment of Plansmith’s Client Spotlight Series is here. Our intimate spotlights are designed with you in mind. You’ll hear firsthand from our guests as they share their real-life experiences with planning, budgeting, managing risk, and making strategic business decisions. [Read More](https://blog.plansmith.com/new-client-spotlight-episode-1-richwood-bank) ## [Surge Deposits: R.I.P. (2018-2019)](https://blog.plansmith.com/surge-deposits-r.i.p.-2018-2019) Posted by [Dave Wicklund](https://blog.plansmith.com/author/dave-wicklund) on 4/8/20, 10:57 AM - [Tweet](https://twitter.com/share) [![](https://blog.plansmith.com/hubfs/computer-768696_1920.jpg)](https://blog.plansmith.com/surge-deposits-r.i.p.-2018-2019) For the past ten years or so, surge deposits have been a material issue in asset/liability management. At the time of, and following the 2007-2009 Great Recession, the banking industry saw a substantial influx of deposits as real estate and equity investors liquidated positions and sought safe places to store their money and ride out the storm. The impact of this flight to safety was compounded by Government sponsored initiatives such as the Transaction Account Guarantee (TAG) Program and increases in Federal deposit insurance levels. As a result, banks experienced significant deposit growth, and while these surge deposits would have normally been seen as a good thing, the near evaporation of loan demand left many banks with far more deposit dollars than they could effectively put to use. In turn, market liquidity levels skyrocketed, but margins were compressed. For the purpose of this article, we’ll refer to these funds moving from real estate, equities, or any other investments into the banking system as Type I Surge Deposits. [Read More](https://blog.plansmith.com/surge-deposits-r.i.p.-2018-2019) ## [How Will Rate Changes Impact Your Budget?](https://blog.plansmith.com/how-will-rate-changes-impact-your-budget) Posted by [Craig Hartman](https://blog.plansmith.com/author/craig-hartman) on 3/11/20, 9:48 AM - [Tweet](https://twitter.com/share) [![](https://blog.plansmith.com/hubfs/stock-1863880_1920.jpg)](https://blog.plansmith.com/how-will-rate-changes-impact-your-budget) Everyone probably has their budgets in place for 2020 by now. And now comes along the Coronavirus and messes everything up. The Fed has already lowered rates by half a point. So, now you’re scrambling to figure out how this will impact your 2020 plans? Seems like you have a few choices: [Read More](https://blog.plansmith.com/how-will-rate-changes-impact-your-budget) [All posts](https://blog.plansmith.com/all) [Next](https://blog.plansmith.com/topic/interest-rate-risk/page/2) ### Subscribe Now! ### Posts by Tag - [community bank planning (54)](https://blog.plansmith.com/topic/community-bank-planning) - [community bank strategy (52)](https://blog.plansmith.com/topic/community-bank-strategy) - [community bank (49)](https://blog.plansmith.com/topic/community-bank) - [credit union planning (46)](https://blog.plansmith.com/topic/credit-union-planning) - [community bank budget software (45)](https://blog.plansmith.com/topic/community-bank-budget-software) - [community bank budgeting (42)](https://blog.plansmith.com/topic/community-bank-budgeting) - [budgeting (41)](https://blog.plansmith.com/topic/budgeting) - [interest rate risk (35)](https://blog.plansmith.com/topic/interest-rate-risk) - [community bank interest rate risk (33)](https://blog.plansmith.com/topic/community-bank-interest-rate-risk) - [community bank budget (30)](https://blog.plansmith.com/topic/community-bank-budget) - [asset liability management (29)](https://blog.plansmith.com/topic/asset-liability-management) - [strategic planning (28)](https://blog.plansmith.com/topic/strategic-planning) - [interest rate risk management (27)](https://blog.plansmith.com/topic/interest-rate-risk-management) - [community bank marketing strategy (26)](https://blog.plansmith.com/topic/community-bank-marketing-strategy) - [fintech (26)](https://blog.plansmith.com/topic/fintech) - [community bank ALCO (25)](https://blog.plansmith.com/topic/community-bank-alco) - [social media for community banks (24)](https://blog.plansmith.com/topic/social-media-for-community-banks) - [strategy (24)](https://blog.plansmith.com/topic/strategy) - [IRR (22)](https://blog.plansmith.com/topic/irr) - [strategic thinking (22)](https://blog.plansmith.com/topic/strategic-thinking) - [bank strategy (21)](https://blog.plansmith.com/topic/bank-strategy) - [social media (20)](https://blog.plansmith.com/topic/social-media) - [ALCO (19)](https://blog.plansmith.com/topic/alco) - [community bank forecasting (19)](https://blog.plansmith.com/topic/community-bank-forecasting) - [strategic planning for banks (17)](https://blog.plansmith.com/topic/strategic-planning-for-banks) - [ceo (16)](https://blog.plansmith.com/topic/ceo) - [leadership (14)](https://blog.plansmith.com/topic/leadership) - [Strategic Plan (12)](https://blog.plansmith.com/topic/strategic-plan) - [bank strategic planning software (12)](https://blog.plansmith.com/topic/bank-strategic-planning-software) - [community bank planning software (12)](https://blog.plansmith.com/topic/community-bank-planning-software) - [CECL (11)](https://blog.plansmith.com/topic/cecl) - [Customer Service (9)](https://blog.plansmith.com/topic/customer-service) - [playbook (9)](https://blog.plansmith.com/topic/playbook) - [alm (8)](https://blog.plansmith.com/topic/alm) - [bank budget (8)](https://blog.plansmith.com/topic/bank-budget) - [bank irr reporting (8)](https://blog.plansmith.com/topic/bank-irr-reporting) - [liquidity (8)](https://blog.plansmith.com/topic/liquidity) - [credit union interest rate risk (7)](https://blog.plansmith.com/topic/credit-union-interest-rate-risk) - [crisis planning (7)](https://blog.plansmith.com/topic/crisis-planning) - [forecasting (7)](https://blog.plansmith.com/topic/forecasting) - [budget playbook (6)](https://blog.plansmith.com/topic/budget-playbook) - [compass (6)](https://blog.plansmith.com/topic/compass) - [reforecasting (6)](https://blog.plansmith.com/topic/reforecasting) - [Outsource IRR (5)](https://blog.plansmith.com/topic/outsource-irr) - [banker education (5)](https://blog.plansmith.com/topic/banker-education) - [surge deposits (5)](https://blog.plansmith.com/topic/surge-deposits) - [what-ifs (5)](https://blog.plansmith.com/topic/what-ifs) - [bank mission vision core values (4)](https://blog.plansmith.com/topic/bank-mission-vision-core-values) - [continuing education (4)](https://blog.plansmith.com/topic/continuing-education) - [credit union budgeting (4)](https://blog.plansmith.com/topic/credit-union-budgeting) - [millennials (4)](https://blog.plansmith.com/topic/millennials) - [IRR Assumptions (3)](https://blog.plansmith.com/topic/irr-assumptions) - [board training (3)](https://blog.plansmith.com/topic/board-training) - [branch budgeting (3)](https://blog.plansmith.com/topic/branch-budgeting) - [decay rate (3)](https://blog.plansmith.com/topic/decay-rate) - [millennial employees in banking (3)](https://blog.plansmith.com/topic/millennial-employees-in-banking) - [rising rates (3)](https://blog.plansmith.com/topic/rising-rates) - [AI (2)](https://blog.plansmith.com/topic/ai) - [FDIC (2)](https://blog.plansmith.com/topic/fdic) - [backtesting (2)](https://blog.plansmith.com/topic/backtesting) - [bank brand marketing (2)](https://blog.plansmith.com/topic/bank-brand-marketing) - [board of directors (2)](https://blog.plansmith.com/topic/board-of-directors) - [compliance (2)](https://blog.plansmith.com/topic/compliance) - [cost center budgeting (2)](https://blog.plansmith.com/topic/cost-center-budgeting) - [deposit study (2)](https://blog.plansmith.com/topic/deposit-study) - [deposit trends (2)](https://blog.plansmith.com/topic/deposit-trends) - [funds transfer pricing (2)](https://blog.plansmith.com/topic/funds-transfer-pricing) - [market intelligence (2)](https://blog.plansmith.com/topic/market-intelligence) - [millennials in banking (2)](https://blog.plansmith.com/topic/millennials-in-banking) - [modern human resources strategy for banks (2)](https://blog.plansmith.com/topic/modern-human-resources-strategy-for-banks) - [peer analysis (2)](https://blog.plansmith.com/topic/peer-analysis) - [stress testing (2)](https://blog.plansmith.com/topic/stress-testing) - [Insider (1)](https://blog.plansmith.com/topic/insider) - [asset prepayments (1)](https://blog.plansmith.com/topic/asset-prepayments) - [baby boomers (1)](https://blog.plansmith.com/topic/baby-boomers) - [brand (1)](https://blog.plansmith.com/topic/brand) - [client spotlight (1)](https://blog.plansmith.com/topic/client-spotlight) - [contingency funding plan (1)](https://blog.plansmith.com/topic/contingency-funding-plan) - [credit union strategic planning software (1)](https://blog.plansmith.com/topic/credit-union-strategic-planning-software) - [employee human resources for banks (1)](https://blog.plansmith.com/topic/employee-human-resources-for-banks) - [event (1)](https://blog.plansmith.com/topic/event) - [financial institution succession planning (1)](https://blog.plansmith.com/topic/financial-institution-succession-planning) - [funding (1)](https://blog.plansmith.com/topic/funding) - [loan prepayments (1)](https://blog.plansmith.com/topic/loan-prepayments) - [market analysis (1)](https://blog.plansmith.com/topic/market-analysis) - [negative rates (1)](https://blog.plansmith.com/topic/negative-rates) - [policy (1)](https://blog.plansmith.com/topic/policy) - [ppp loans (1)](https://blog.plansmith.com/topic/ppp-loans) - [profitability (1)](https://blog.plansmith.com/topic/profitability) - [sensitivity testing (1)](https://blog.plansmith.com/topic/sensitivity-testing) - [social video for banks (1)](https://blog.plansmith.com/topic/social-video-for-banks) - [strategic action plan (1)](https://blog.plansmith.com/topic/strategic-action-plan) - [trade show (1)](https://blog.plansmith.com/topic/trade-show) See all ### Recent Posts - Navigate - [Home](https://www4.plansmith.com/) - [Budgeting](https://www4.plansmith.com/budgeting/) - [Asset Liability Management](https://www4.plansmith.com/alm/) - [CECL](https://www4.plansmith.com/cecl/) - [Strategy](https://www4.plansmith.com/strategy/) - [Market Intelligence](https://www4.plansmith.com/market-intelligence/) - [About](https://www4.plansmith.com/about/) - [Contact Us](https://www4.plansmith.com/contact-us/) - Products - [StrategyGPS](https://www4.plansmith.com/strategygps/) - [Compass](https://www4.plansmith.com/compass/) - [BankersGPS](https://www4.plansmith.com/bankersgps/) - Resources - [Blog](https://blog.plansmith.com) - [Videos](https://plansmith.wistia.com/projects/7qemazkqii) - [Compass Tutorials](https://info.plansmith.com/compass-tutorials) - [Lunch n' Learns](https://info.plansmith.com/lunch-n-learns) - [Webinars](https://www4.plansmith.com/webinars/) #### Contact 1827 Walden Office Square, Ste. 350 Schaumburg IL 60173 Toll Free: 1.800.323.3281 Local: 1.847.359.4045 Fax: 1.847.705.8200 info@plansmith.com Copyright 2018 | Plansmith Corporation