According to a Federal Deposit Insurance Corporation (FDIC) report, US banks are contending with an astounding $684 billion in unrealized losses on securities as of the end of Q3. The report indicates a significant uptick of $126 billion, marking a 22.5% increase in just a few months. Unrealized losses denote the disparity between the acquisition cost of bonds and their current market value. While banks can retain these bonds until maturity, they pose a potential liquidity challenge when immediate cash injection is required.
Source: Daily Hodl