The Institutional Risk Analyst

Even a small decrease in prepayments due to higher LT interest rates could significantly impact the fair value of the Bank of America mortgage portfolio, forcing unrealized losses higher. If LT rates continue to rise, one veteran banker told The IRA yesterday, then BAC and several other large banks are going to start to literally shake apart from unrealized losses on COVID era assets.

When you see a bank with more than 10% of total assets in MBS, that's a big red flag in our book.

The SVB duration management from 2020 onward was recklessly negligent by any reasonable standard

The sad fact is that even with another 2% capital, most US banks are arguably insolvent thanks to the Fed “going big.”

The Federal Open Market Committee has arguably lost control of monetary policy and has placed America's banks in grave risk.