UNBOOKED LOSSES AT BANKS SPIKE IN FIRST QUARTER OF YEAR

BY AMBER BONEFONT | 7/3/2024

The screener, part of the Banking Initiative at Florida Atlantic University, is a quarterly report measuring banks’ exposure to risk based on their unrealized losses in their portfolios of investment securities. Four banks had losses that exceeded their equity capital: Union City SVGS Bank, where unbooked losses equaled 172.7%; Citizens ST Bank, where unbooked losses equaled 121.4%; Green Dot Bank, where unbooked losses equaled 108.6%; and First America TR, where unbooked losses equaled 104%.

Larger banks on the list with more than $10 billion in equity had unbooked security losses more than their equity capital:

• Charles Schwab, where unbooked losses equaled 64%;

• USAA Federal Savings Bank, where unbooked losses equaled 67% of their equity capital;

• Bank of America NA, where unbooked losses equaled 58%.

Rising rates have had a negative effect on the balance sheets of many banks regarding their unbooked securities losses.

“It’s likely that losses in the second quarter could be far greater as the yield on the 10-year treasury rose from 4.21% at the end of this quarter to 4.48% most recently,” Cole said. “There also are many smaller banks with less than $1 billion in assets facing similar risks; 22 have unbooked losses greater than 100% of their equity capital and 275 have losses greater than 50%.”

The WSJ says: “Tougher Stress Tests Are No Big Strain for Banks”

Does ANYONE tell the whole truth anymore? Look at the fines etcv paid by these giant banks over the past 20 years (Pillars - Is this who you ask for advice?)

STOP GUESSING! BUILD A PORTFOLIO TAHT PROTECTS YOU WITHOUT REDUCING GAINS!

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