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US banks are currently holding nearly $500 billion in unrealized losses on investment securities, according to recent Federal Deposit Insurance Corporation (FDIC) data. These losses increased by $118.4 billion in the fourth quarter of 2024, reaching a total of $482.4 billion. This marks the 13th consecutive quarter of unrealized losses for banks, the longest streak since 2009. The rise in unrealized losses is attributed to higher interest rates, which have persisted amid concerns about stagflation—characterized by high inflation and slow economic growth. In such an environment, there is a risk that interest rates will remain elevated for an extended period, potentially leading to mounting credit losses, particularly for lenders focused on technology, growth sectors, and venture capital-backed companies.
Latest FDIC data shows banks sitting on nearly $500B in unrealized losses on securities. If stagflation sticks around—high rates, slowing growth—lenders to tech, growth, and VC could face mounting credit losses. Source: Apollo, FDIC. https://t.co/dapR67A0Af
FDIC data shows that the banking sector is currently holding almost $500 billion in unrealized losses on investment securities. In a stagflation scenario, the risk is that rates will be higher for longer and credit losses will begin to accumulate, in particular for lenders to https://t.co/rGVWGtCm7X
⚠️Unrealized losses on investment securities for US banks are ELEVATED: Unrealized losses on investment securities for US banks jumped $118.4 billion in Q4 2024 to $482.4 BILLION. Banks have now seen 13 straight quarters of unrealized losses, the longest streak since 2009. https://t.co/PIzMmHlxYX
