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The Andover State Bank has purchased a corporate bond from the Tristate Manufacturing Company that has 1 5 years to maturity and has a coupon

The Andover State Bank has purchased a corporate bond from the Tristate Manufacturing Company that has 15 years to maturity and has a coupon rate of 6.25%. Market interest rates have recently declined to 5.25% and the Andover State Bank is worried that the Tristate Manufacturing Company will exercise its right to retire the bonds early, and issue new corporate bonds with a lower coupon rate. What type of risk is the Andover State Bank worried about?

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