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Never heard of this research firm before … but boy even if half of this is correct, the implications could be unsettling.
You can see $15.1 billion of unrealized losses on the HTM vs. $1.3 at 2021. This is all MBS and its toasted more now than at 12/31/22. Average yield on this book is a mere ~190 bps. They can't sell this. They are frozen. pic.twitter.com/3XMxtZ3ecV
— Lake Cornelia Research Management (@CorneliaLake) March 9, 2023
This is a sickening movie to watch. The two cardinal sins with the bank "rescue" financing are:
(1) Launching without a baked and fully committed deal
(2) Not raising enough to obviously answer the market questions and failing to decisively take balance sheet risk… https://t.co/SGs30brK8V— Lake Cornelia Research Management (@CorneliaLake) March 9, 2023
The market implications of this situation are far and wide. We have a $210+ billion balance sheet (which was a mere 86 billion 2 years ago) that could well have an unwind. It is not a stretch at all to argue that on a current mark to market basis… pic.twitter.com/HpWdwjNP2t
— Lake Cornelia Research Management (@CorneliaLake) March 9, 2023
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