Bank Failures Explained: Questions, Answers and How CRE Fits In

Unrealized Losses on Securities Relative exposure by bank size

QUESTION SIX

UNREALIZED LOSSES ON SECURITIES Relative exposure by bank size

Are more regional banks going to fail?

Nominal Unrealized Losses (Billions) N i al Unrealized Losses (Billions)

Nominal Unrealized Losses Relative to Capital No i l Unrealized Losses Relative to Capital

$300

$25

2.0%

25%

$250

ANSWER

1.6%

20%

$20

Hard to say, but most regional banks should not face the same issues as Silvergate, SVB and Signature. However, no bank, no matter how well-managed, can survive a run on deposits.

$200

1.2%

15%

$15

$150

0.8%

10%

$10

$100

0.4%

5%

$5

$50

0.0%

0%

$0

$0

<$10 billion $10-$100 billion

$100-$250bn >$250bn+

<$10 billion $10-$100 billion

$100-$250bn >$250bn+

Unrealized Loss % Equity HTM Unrealized Losses % of Equity (RHS) HTM Unrealized Losses % of Equity (RHS) Unrealized Loss % Equity

Book Value Minus Fair Value (Unrealized Loss) Average Unrealized Loss (RHS) Book Value Minus Fair Value (Unrealized Loss) Average Unrealized Loss (RHS)

Source: FDIC, Moody’s Analytics

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Source: FDIC, Moody’s Analytics

Bank Failures Explained - Questions, Answers and How CRE Fits In

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