Unrealized gain or losses are the changes, either up or down, on the securities an entity has purchased but not yet sold. In this report (Chart 6), the Federal Deposit Insurance Corporation (FDIC) announced that the bank industry’s holding of long-term loan and securities have declined in 38.3%, what translate in about $560 billion in losses.
These assets do not affect the finances of the institutions until they decide to sell, however this low yield will affect the earning in coming quarters. According to FIDC, the main reason of this situation is the increase of interest rates since beginning of 2022.
